An Adjustable Rate Mortgage (ARM) differs from a fixed-rate mortgage in that its interest rate fluctuates over time, unlike the fixed rate which remains constant throughout the loan's term. Initially, ARMs offer a lower interest rate compared to fixed-rate mortgages. As a result, an ARM might be a favorable choice if you intend to own your home for only a few years, anticipate an increase in your future income, or find the current fixed mortgage rates too high.