When it comes to refinancing your mortgage, there are two main types of loans to consider: fixed-rate and adjustable-rate mortgages (ARMs). The primary difference between the two is that a fixed-rate loan has an interest rate that will never change, while an ARM's interest rate can fluctuate over the life of the loan. Fixed-rate mortgages typically have higher starting interest rates than ARMs. This means that you will pay more in interest during the initial period of the loan.
However, if you plan to stay in your home for a longer period of time, a fixed-rate loan may be the better option as it will provide you with a consistent monthly payment. On the other hand, adjustable-rate mortgages usually have lower starting interest rates than fixed-rate mortgages. This means you'll pay less money in interest during the introductory period. If you plan to own your home for a shorter period of time, a lower starting rate can save you money on your monthly mortgage payment.