ARM and Interest-Only ARM vs Fixed-Rate Mortgage Calculator
Your results
Lowest interest over your horizon
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Lowest starting payment
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Interest-only ARM payment jump
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Interest-only means no equity from payments
While you pay interest only, the balance does not go down. If home prices fall or you need to sell early, you owe the full amount you borrowed. ARM results depend on the rate path you assume; the worst-case rows show what happens if rates rise as fast as the caps allow.
Side-by-side over your horizon
Payments, interest and the balance you would still owe when you expect to sell or refinance. Interest is the true cost of each loan up to that point; the rest of what you pay goes to principal.
| Measure | Fixed rate | ARM | Interest-only ARM |
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Year-by-year comparison
Rate, monthly payment and balance at the end of each year on the expected rate path. Rows within your horizon are marked with an asterisk.
| Year | Fixed payment | ARM rate | ARM payment | IO ARM rate | IO ARM payment | Fixed balance | ARM balance | IO ARM balance |
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Results are estimates for educational purposes and are not financial, tax or legal advice.
Put three mortgages head to head: fixed rate, a regular adjustable-rate loan and an ARM that starts interest-only, over the years you expect to keep the mortgage. See each loan’s payments, interest cost, payment jumps and the balance you would still owe. If you want to see how the figures change, the amortization calculator gives you an instant result you can adjust as you go.