When shopping around for a mortgage, you'll need to make a decision on what type of mortgage you want to use to purchase your home. While a fixed rate, 15- or 30-year mortgage is very common, you may be wondering if an adjustable rate mortgage is right for you. Here are some reason why it would be a wise decision to get an adjustable rate mortgage.

You Plan On Selling In 5 Years

One of the benefits of using an adjustable rate mortgage is that the initial interest rate is lower than the current interest rates available for a fixed rate mortgage. These low rates are valid for a specific amount of time, such as 5 or 7 years, and then interest rates change.

If you know for sure that you won't be in the home for very long, you can take advantage of those low interest rates and save money on your mortgage while you are in the home. When the interest rate starts fluctuating, you'll already be thinking about your next home and getting a new mortgage

You Think Rates Will Go Down

Interest rates can be unpredictable, but looking at trends in interest rates may give you an idea of where they are going in the future. If you think that interest rates will fall after a few years, know that you do not need to be locked into the current rates when you purchase your home. When your initial period of the ARM ends and interest rates start to adjust, you can take advantage of lower rates in the future. This gives you the flexibility of buying a home today and getting those lower interest rates down the road without having to refinance.

Of course, interest rates can always increase from the date that you got the ARM, leading to higher mortgage payments.

You Can Invest The Money You Save

Saving money with an initial low interest rate is not going to mean much if that money just stays in your savings account at the bank. If you have another use for the money you will save that can bring in a great return on your investment, then an ARM will be right for you.

These are just a few reasons to get an adjustable rate mortgage. Contact a local mortgage lending company to figure out if it would be the best fit for your financial needs.