Fixed Rate vs. Adjustable Rate Mortgages

Bank of Internet USA offers both Fixed Rate Mortgage Loans and Adjustable Rate Mortgage (ARM) Loans. Which of these mortgage options is best suited to your unique needs and financial goals?

Fixed Rate and Adjustable Rate Mortgages

Choosing between a fixed rate mortgage and an adjustable rate mortgage is a big decision. Both and disadvantages.

A fixed rate mortgage may be beneficial for people who:

  • Intend to stay in their home more than seven years.
  • Don’t want to risk an increase in monthly payments.

An adjustable rate mortgage may be beneficial for people who:

  • Only intend to live in the home for less than seven years.
  • Need the initial lower interest rate.
  • Are comfortable with the risk of rate increase.

Call 1.888.546.2634 to speak to a knowledgeable Bank of Internet USA Mortgage Consultant who will find a mortgage solution that is just right for you.

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Fixed Rate Mortgages

With a Fixed Rate Mortgage, your interest rate and total monthly payment of principal and interest stay the same throughout the term of the mortgage. There are many factors to consider when deciding between a Fixed and Adjustable Rate Mortgage.


With a Fixed Rate Mortgage from Bank of Internet USA, your mortgage payment stays the same regardless of any market changes. Financial planning is simpler when you have a predictable mortgage payment every month.

There's no risk of a higher payment in the future.

Even though your rate and payments are fixed, you may still be able to at a later date.


Your payment stays the same regardless of any market changes (the rate may go down).

Compared to an ARM, your payments may be higher for the first few years.

If you know you're moving in a few years, you could miss out on the savings from a lower ARM payment.

Adjustable Rate Mortgages (ARMs)

With an Adjustable-Rate Mortgage (ARM), the initial interest rate is lowered and fixed for a period of time, normally between one and five years. After that, the rate and payments adjust periodically based on an economic index. At that point, some homeowners elect to .


An Adjustable Rate Mortgage from Bank of Internet USA offers lower initial payments. If the starting interest rate is lower than a fixed loan, you can save money during the initial period.

You may qualify for a larger loan because the lower initial interest rates result in more affordable payments.

Adjustment period interest rate limits. Most ARMs include an interest rate cap which limits the maximum interest payment allowed for the loan.


When the adjustment period begins, your payments can increase.