The Adjustable Rate Mortgage (ARM) is a loan option that allows borrowers to enjoy a lower initial interest rate for a set period of time. After the initial period, the rate will adjust according to movements in an index, such as the LIBOR or Prime Rate. This means that the rate can vary from month to month and the initial rate may not be the rate for the life of the loan. The Adjustable Rate Mortgage option allows borrowers to take advantage of a rate that is lower than a fixed-rate mortgage, making it more affordable in the short term. This loan option also provides more flexibility and the ability to take advantage of lower rates should market conditions improve. The risk, however, is that rates can go up which may result in higher payments. It is important to note that the Adjustable Rate Mortgage may not be the best loan option for everyone. It’s important to carefully weigh all options before committing to a loan and consider factors like your budget and plans for the long term.