The Mortgage Pivot: Adjustable Rate Mortgages (ARMs)

The Mortgage Pivot: Adjustable Rate Mortgages (ARMs)

As interest rates climbed in late 2022, buyers in Newton and Needham began pivoting away from 30-year fixed rates toward Adjustable Rate Mortgages (ARMs).

Why the Shift?

• Lower Initial Rate: ARMs often offer a rate 1-1.5% lower than a fixed mortgage for the first 5, 7, or 10 years.
• Strategy: Many luxury buyers plan to refinance or sell before the rate adjusts.
• Affordability: It's a tool to keep monthly payments manageable in a high-price market.

Is it Right for You?

ARMs are great for those with short-to-medium term plans. If you're in your 'forever home,' the fixed rate still offers the ultimate peace of mind.

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