“ARMs”. You’ve heard the term thrown around, but what are they? For some, they’re considered the best of both worlds: a fixed and a variable rate loan. So, a 5/1 ARM means a fixed rate for 5 years, then a variable rate for every year afterward. An ARM may be a good option for someone who doesn’t plan on living in the same house for more than 5 years, or for someone who sees their income growing in the future.