Is an Adjustable-Rate Mortgage Worth a Look Right Now? I Ran the Numbers on the Median Central Florida Asking Price

By Brenden Rendo, Realtor · Updated November 14, 2026

Arguing about whether adjustable-rate mortgages are good or bad is a waste of a conversation. An ARM is a structure, not a verdict, and the only way to judge one is to run it against a real asking price with today's actual pricing and then look at what the payment becomes if rates do not cooperate. So that is what I did. One loan amount, one day of rates from one survey, three numbers the rate on the flyer never shows you.

The four numbers that define any ARM

Everything that matters about an adjustable loan lives in four fields on your loan estimate, and none of them is the rate in the headline.

The initial fixed period. A 7/6 ARM is fixed for seven years, then adjusts every six months. A 5/6 adjusts after five years. The first number is years of certainty. The second is how often the clock ticks after that.

The index. Conforming adjustable loans today are tied to the Secured Overnight Financing Rate. The 30-day average SOFR was 3.92% on November 13, 2026, per the Federal Reserve Bank of St. Louis FRED series SOFR30DAYAVG. It moves. It is not yours to control.

The margin. This is the lender's fixed add-on to the index, and as the CFPB explains, the margin is set in your loan agreement and will not change after closing. This is the part people skip, and it is the part that never goes away. The index can move in either direction; the margin cannot. Your rate after the fixed period is index plus margin, subject to the caps, and nothing else.

The caps. Written as three numbers, such as 2/1/5 or 5/1/5. Per the CFPB's guide to ARM rate caps, the initial adjustment cap is "either two or five percent," the subsequent adjustment cap is "most commonly one or two percent," and the lifetime cap is "most commonly five percent," though some loans go higher. For the 7/6 SOFR ARM priced below, Fannie Mae's Selling Guide lists 7-year SOFR ARMs at 5/1/5 and 5-year SOFR ARMs at 2/1/5. On 5/1/5, that is up to 5 percentage points at the first change, 1 at each change after that, and 5 over the life of the loan. Those are the guardrails, and the top one is the number your decision should turn on.

What the discount is worth today

Here is the setup. I used the median asking price of the 9,319 active single-family listings Orange, Seminole, Lake and Volusia counties were showing on November 12, 2026, which was $459,000 per Stellar MLS data pulled that day. That is a list price, not a sale price, and it is single-family only. The all-types median across all 13,842 active residential listings was $395,000, and the condo and townhouse median was $265,948 across 3,520 listings. Put 20% down on the single-family figure and the loan is $367,200.

Now the two rates, and they have to come from the same survey on the same day, or the gap between them means nothing. On Friday, November 13, 2026, the Mortgage News Daily daily index had the 30-year fixed at 7.50% and the 7/6 SOFR ARM at 7.13%, 0.37 percentage points apart. You will also see Freddie Mac's 30-year average of 7.11% in the survey released November 12, 2026 quoted everywhere. That is a weekly average from a different survey, and Freddie Mac no longer publishes an ARM rate, so it cannot be set against either ARM figure here.

Those are principal and interest only. Property taxes, hazard insurance, flood coverage where it applies, HOA or condo dues and any mortgage insurance ride on top of both columns equally, so they do not change the comparison, but they do change what you can actually carry.

So at Friday's pricing, the honest answer to "is an ARM worth a look" is that the product is on sale, modestly. $92.38 a month, and $9,610.28 over seven years, is what the market is currently paying you to accept the rate risk on that loan. Whether that is enough depends entirely on the next two sections.

That gap is not fixed, and a different survey gives a different answer, which is why you price your own loan rather than a headline. The Mortgage Bankers Association's weekly survey, posted on those same Mortgage News Daily pages for November 11, 2026, had the 30-year fixed at 7.21% with 0.75 point and the 7/6 SOFR ARM at 6.28% with 1.14 points, 0.93 percentage points apart. On this loan that is $2,495.00 against $2,268.08, a saving of $226.91 a month and $24,058.45 over seven years counting the faster paydown. But the ARM quote carries 0.39 more discount points, which is $1,432.08 more cash at closing on this loan (one point is $3,672), so the seven-year edge is $22,626.37 once you pay for it.

The capped worst case, which is the real decision

Month 85 is the moment the loan stops being a fixed-rate mortgage. At that point the ARM balance is $335,364 with 276 payments left, and the new rate is index plus margin, bounded by the caps. Using the two initial-cap values the CFPB names:

On a conforming 7/6 SOFR ARM with Fannie Mae's standard 5/1/5 caps, the bottom row is the usual first-reset ceiling. The 2-point row applies to 2/1/5 loans, which are more common on 5/6 ARMs.

Read the bottom row again. A loan that started at $2,475.13 can contractually become $3,615.18 on a single adjustment date, and could stay there for the remaining 23 years. That happens only if SOFR plus your margin is at or above 12.13% at a reset. Nobody can tell you whether it will; the cap tells you what it would cost.

The question is not whether you think that will happen. The question is whether your household budget survives it if it does, because you are the one who signed for it. If the answer is no, the caps have already answered the ARM question for you.

The break-even, honestly stated

There are two break-evens and people only ever quote the friendly one.

The friendly one: if you sell or pay the loan off before the first adjustment, you keep every dollar of the discount. On Friday's pricing that is $9,610.28 over seven years of certainty, which is real money.

The one that decides it: if you are still in the loan when it adjusts, how long does the higher payment take to swallow what you banked? At 9.13% the payment runs $343.39 a month above what the fixed loan would have cost, so the seven years of saving are gone in 22.6 months, or 28.0 months if you credit the extra principal. At 12.13% it runs $1,047.66 a month above the fixed payment and the saving is gone in 7.4 months, or 9.2 months with the principal. Seven years of saving against about seven months of exposure at the 5/1/5 ceiling a conforming 7/6 carries, or about two years on a 2/1/5 loan, is the trade you are actually being offered.

Run the same test on the wider MBA quote and the cushion grows: $19,060.74 banked in payments, erased in 100.4 months at the lower cap (8.28%) or 21.9 months at the lifetime cap (11.28%), or 126.8 and 27.7 months counting the faster paydown, before you pay for the extra points. A wider discount buys a thicker cushion. None of it moves the ceiling.

A real Central Florida flyer, and what its footnote said

This is not theory here. A regional builder's flyer late this summer led with 3.99%, and I wrote up the fine print in the builder incentive breakdown. The footnote described an FHA 5/1 adjustable loan: fixed for five years, then adjusting every twelve months on the one-year Treasury plus a 2.00% margin, with a stated maximum rate of 8.99% and a stated maximum payment of $3,157 on a $392,755 loan whose starting payment was $1,873.

That is the whole lesson in one document. The buyer sees 3.99%. The footnote's own maximum is $3,157 a month. And the margin is doing quiet work in the background: the one-year Treasury was 4.65% on November 12, 2026 per the FRED one-year Treasury series, so that loan's fully indexed rate at today's index would be 6.65%, well above the 3.99% on the flyer. The index can fall or rise from there; the 2.00% margin is part of the rate either way.

For what the fixed-rate side of this market has done to buyer budgets, I covered that separately in the rate-climb cost breakdown.

Who an ARM actually suits

An ARM is a reasonable tool for a narrow set of buyers, and I would rather say who those are than pretend it is nobody.

It can suit a buyer with a known, dated, short horizon inside the fixed period, a military transfer, a planned relocation, a job with a defined term, combined with enough income and reserves to carry the capped payment anyway if the plan slips. Both halves matter. The horizon alone is not enough, because plans change and the cap does not.

It does not suit a buyer who needs the ARM to afford the house. If the fixed payment does not work and the ARM payment does, the ARM has not solved an affordability problem, it has postponed one and attached a penalty to it. It also does not suit anyone whose plan depends on refinancing out before the adjustment. I cannot tell you rates will be lower in five or seven years, nobody can, and refinancing requires qualifying again on that day's income, credit, appraisal and guidelines. Treat it as a possibility, never as the plan.

The practical sequence for buyers in Orange, Seminole, Lake and Volusia right now is the same as always: settle the financing path first, then shop price. If a fixed payment on the house you want does not clear your budget, the fix is usually a different price point, not a different loan structure. The price-reduced listings in Orange County, Seminole County, Lake County and Volusia County are where that search usually starts, and the Central Florida market hub has the county-level numbers behind it.

Common questions about ARMs

Is a 7/6 ARM cheaper than a 30-year fixed right now?

Modestly, at Friday's pricing. On November 13, 2026, the Mortgage News Daily daily index had the 30-year fixed at 7.50% and the 7/6 SOFR ARM at 7.13%, the same survey on the same day. On a $367,200 loan that is a $92.38 monthly difference in principal and interest, or $7,760.08 across the seven-year fixed period. Your own quote may differ, and points change the comparison.

What is the worst my ARM payment can be?

Multiply it out from the lifetime cap on your loan estimate, not from the start rate. On a $367,200 loan starting at 7.13%, a lifetime cap of five percentage points puts the maximum rate at 12.13% and the payment at $3,615.18 after the first adjustment, which is 46.06% above the starting payment of $2,475.13. The CFPB says a lifetime cap of five percent is most common, though some loans go higher, so read yours.

What does the margin do on an adjustable loan?

The margin is the lender's fixed add-on to the index, it is set at closing, and it never changes. Your rate after the fixed period is the index plus that margin, bounded by the caps. One Central Florida builder flyer late this summer used the one-year Treasury plus a 2.00% margin, and with that index at 4.65% on November 12, 2026, the fully indexed rate would be 6.65% even though the flyer advertised 3.99%.

Can I just refinance before the ARM adjusts?

Maybe, and you should not count on it. Refinancing requires you to qualify again on that day's income, credit, appraisal and lending guidelines, and nobody can tell you where rates will be in five or seven years. If the capped payment would break your budget, the right assumption is that you will be in the loan when it adjusts.

Want this run on your actual numbers? Send me the loan estimate and I will build this same table on your price point, your rate quote and your caps, side by side with the fixed option, before you sign anything. No pitch attached. Call or text 407-616-9019, or send a message here, and we will start with the financing path before we talk about houses.