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Fixed rate vs Variable rate
A fixed rate never changes; a variable rate can move up or down with the market. Which is right depends on how long you'll hold the loan.
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Feature
Fixed rate
Variable rate
Payment predictability
Same every month
Can change
Starting rate
Higher
Usually lower
Risk if rates rise
None — you're locked
Payment can jump
Best when...
You'll hold 5+ years
You'll pay off in 1–3 years
Refinance friendly
Yes
Less common
Our take
Choose fixed for predictability and peace of mind. Choose variable only when you're confident you'll pay off the loan before rates could climb.
Common questions
How much lower is a variable rate?
Typically 0.5%–1.5% at the start — but that can flip within a year or two if rates rise.
Can a variable rate cap out?
Most have periodic and lifetime caps. Read the note for the exact numbers.