Which type of loan is best? That depends several factors such as how long you plan to stay in your home, your interest-rate outlook, your budget, and your tolerance for risk.

Adjustable-rate mortgages are initially cheaper than fixed-rate loans. And they can be a good deal if you know you're going to stay in your home for a relatively short period of time. But you run the very real risk that interest rates could rise sharply and drive up your monthly payments. Fixed-rate loans, on the other hand, cost more but offer no surprises. And for many, that comfort is worth the added price.

To figure out which is best, you've got to consider both your best and your worst-case scenarios. Our worksheet can help. Just fill in your numbers and then use the graph and "compare" feature to evaluate your fixed and adjustable options based on the total amount of interest paid as well as the amounts of your first and last payments.

Fixed vs Arm Calculator >>