What is the difference between a fixed-rate mortgage and an adjustable-rate mortgage?

Allegiance Credit Union offers both fixed-rate and adjustable-rate mortgages. Here is the difference:

A fixed-rate mortgage means your interest rate is locked for the life of your loan term and will not change. Therefore the monthly principal and interest payment stays the same for your full loan term.

Allegiance offers fixed rate mortgages from 5-30 year loan terms.

Adjustable-rate mortgages, often called an “ARM”, starts with a lower interest introductory rate, then after a set number of years the interest rate recalculates.

Allegiance has a 5/5 ARM option. For this option, the lower interest introductory rate is set for the first five years. After the five years expire, the rate is recalculated every five years for the remainder for the loan term.