As rates climb past 7%, homebuyers increasingly turn to ARMs — slide 1 of 6

As rates climb past 7%, homebuyers increasingly turn to ARMs — slide 2 of 6

As rates climb past 7%, homebuyers increasingly turn to ARMs — slide 3 of 6

As rates climb past 7%, homebuyers increasingly turn to ARMs — slide 4 of 6

As rates climb past 7%, homebuyers increasingly turn to ARMs — slide 5 of 6

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As rates climb past 7%, homebuyers increasingly turn to ARMs

October 07, 2026

More homebuyers are choosing adjustable-rate mortgages (ARMs) as fixed rates exceed 7%, with ARMs making up nearly 11% of mortgage locks recently. Borrowers with seven-year ARMs from 2020 face median payment increases over $1,000 monthly when fixed periods end in 2027. New ARMs typically have fixed rates for 5-7 years before adjustments. Rising rates have reduced affordability, with median payments now consuming over 31% of household income.

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