What is the difference between a fixed-rate and an adjustable-rate mortgage?

In Florida, a fixed-rate mortgage is a type of residential real estate loan where the interest rate remains the same for the duration of the loan. This type of loan offers the borrower more security and predictability as the interest rate will not change, allowing them to budget more easily. On the other hand, an adjustable-rate mortgage (ARM) is a residential real estate loan with an interest rate that can change over time. ARMs usually have lower interest rates than fixed-rate mortgages at the beginning, but the rate can increase or decrease after an agreed-upon period. The adjustment period, the number of rate changes, and the maximum amount the rate can change are all specified in the loan agreement. Both types of mortgages have their advantages and disadvantages. Fixed-rate mortgages offer more stability and security, but have higher interest rates. ARMs can offer lower interest rates at the start, but the rate can change, making it more difficult to budget. It is important to analyze your personal situation and weigh the risks and rewards of each loan before deciding which one is right for you.

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What is the difference between a fixed-rate and an adjustable-rate mortgage?

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