WORDS I LIKE — Clear tradeoffs calm decisions.
Someone told you an ARM is the cheaper loan.
Someone else told you it's a gamble.
Both sounded sure of themselves.
Right now, they're both right.
It depends on how much you borrow.
The Detail That Changes The Decision
An adjustable-rate mortgage, or ARM, holds one rate for a set period. On a 7-year ARM, that's seven years. After that, the rate can adjust once a year, within set limits.
Denver's $1 million-plus market is busier than you'd think. Those sales are up about 2% this year while overall sales are down about 5%, per DMAR's September report.
Most people assume an ARM saves money no matter what. I priced real loans this week at equal costs. A conventional ARM came in only about an eighth of a point lower. That's around $40 a month, which rarely justifies a rate that can change.
Jumbo loans, the ones above the standard conventional limit, are different. The ARM runs about half a point lower. On a $1 million loan, that's roughly $330 a month, or about $28,000 over seven years.
That's real money. So is the risk if you're still in the loan when it adjusts. The right fit is someone with reserves and a clear plan to move, pay down, or refinance.
This Week's Takeaway
Price both loans at the same cost. Then decide by how long you'll keep the loan.
Free Guide — The Affordability Playbook
If an ARM isn't the right fit, this guide shows how a buydown can lower your payment instead.
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PS
If you're shopping above $1 million and want both loans priced side by side, just reply with the word "jumbo" and I'll walk through your numbers.
No spam. No sales pitches. Just clarity.
— Neil Christiansen, Certified Mortgage Advisor
Payment comparisons are illustrative, based on Neil’s lender pricing as of October 26, 2026: 30-year amortization, equal points on each loan, 7/6 ARM with 5/1/5 caps. Not a commitment to lend. Rates, APR, and terms vary by borrower and are subject to change.
