Fixed rate mortgage
Easily the most popular type of mortgage loan. Because it’s a fixed interest rate, you’ll know exactly what your monthly payment of principal and interest will be for the life of the loan. Escrow for tax and insurance may be required in certain cases, which will increase your monthly payment.
Adjustable rate mortgage
An adjustable rate mortgage (ARM), as it’s commonly known, has an interest rate that can change during the life of the loan. This means it can potentially increase or decrease the rate and the amount of the monthly mortgage payment.