How does it work and does it make sense using it now with the rates are very high.
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It means that the mortgage rate adjusts, usually based on the Prime Rate set by the Federal Reserve. Whether or not it “makes sense” depends on the individual’s needs. If the rate goes up, the person’s mortgage payment will go up; if the rate goes down, so does the monthly payment. However, since it is often (but not always) possible for a borrower to re-finance a fixed-rate mortgage anyway, whether a fixed- or adjustment-rate mortgage is more financially prudent is based entirely upon the borrower’s specific needs, desires, and financial situation. That is why both types of mortgage rates exist.
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