Cheaper now. But what happens later?
An ARM starts below the fixed rate. The question is whether you'll be gone before it resets — and what the payment looks like if you're not.
Your numbers
ARM type
After the fixed period
Caps: 5% at the first reset, 2% per year after, 5% over the life of the loan.
Side by side
30-yr fixed
$3,442
6.95%
Same payment for the whole term.
7/1 ARM — start
$3,287
6.50%
Locked for 7 years.
ARM — worst case
$4,855
11.50%
Most it can reach after year 7.
The honest read
Over 10 years, the ARM costs $37,806 more than the fixed.
Worst case, the payment goes from $3,287 to $4,855 — that's $1,413 a month more than the fixed. If that number would break you, take the fixed.
Year by year
Mint bars are months the ARM is cheaper than the fixed. Red bars are months it isn't.
How to read this
ARM rates aren't published by the Fed anymore, so we estimate them as the live 30-year fixed minus a typical spread (0.45 points for a 7/1) — today's fixed anchor is 6.95% as of 2026-09-17. Your lender's actual ARM quote, margin, and index will differ. Refinancing or selling before the reset is the whole ARM bet — if you're not confident you'll be out in time, the fixed is the boring, safe answer. Run the full payment with taxes and insurance.
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Estimates only. Not an appraisal, tax advice, or lending offer. Checking here never touches your credit.