Q: My wife and I need to refinance out of our current first mortgage. We bought our home three years ago with a first-time buyer program, which required us to pay interest-only for 36 months then, after 36 months, the interest rate goes sky-high if we don’t refinance. Our question is in regard to the general type of loan we should apply for. We have talked to two different lenders who want to put us into a variable interest rate loan. The starting interest rate is so low our payments would almost be half of a regular fixed loan. Both of our parents are telling us not to get into a variable rate loan because it’s just a ploy to get us to pay a lot higher interest down the road. What do you think?

A: What I think has everything to do with what you think your future in the home is going to be.

It also has a lot to do with the particulars of the loans you’re looking at.

We are all familiar with your basic, conventional, fixed-rate mortgage. You get a loan at a fixed interest rate and your principal and interest payments remain the same for as long as you have the mortgage, typically 30 years.

Variable rate loans are just what they sound like, variable.

The interest rate changes constantly during the life of the loan depending mostly on prevailing rates.

The big question is, on what do they base the changes and how often can they make them?

Variable rates can be tied to the prime rate, the rate on T-bills and other government investments, or any of a hundred different financial indexes, both here and in Europe.

Some of these indexes are very volatile, meaning they change frequently. Others change very slowly. Some make wild swings, both up and down, while others change a half of a percent at a time.

One of the keys to comparing adjustable loan rates is to take a look at the index the loan is tied to and to research what that rate has done over the past four or five years.

The other element to consider is how often the loan can be “adjusted.” That varies among different loans from monthly to annually, with semiannually seeming to be the standard.

The bigger question is how long do you intend to stay in the house?

If you believe this house is long-term, say more than five to seven years, a fixed rate is generally accepted to be the better investment, since we know that rates will rise and fall over a somewhat predictable time span.

On the other hand, if your plans involve moving in the coming few years, an adjustable rate will probably save you money over that period of time, regardless of what the rates do. At least that’s true if the loan is tied to a slow-moving index.

Another consideration is where you think we are in the market right now.

If you think fixed rates are as low as they are going to be for the next five to eight years, you may be more encouraged to jump on them. If you think they’re going to go down soon, the variable may be the best choice.

The right answer, is, of course, that there is no right answer.

There are too many variables, both with the loans and your particular needs.

Because the starting interest rates are low, qualifying for a variable rate loan is often easier. That may be critical for you and ends the debate on the spot.

Getting into the variable rate may, or may not, be cheaper than a good fixed rate and that may have an influence on your decision.

You’re doing the right thing by talking to several lenders. Keep doing that. They all have different opinions and loans to offer.

I don’t recommend using an online company to apply for a loan. My personal opinion is I’d rather deal with a living, breathing loan officer whose office is only a short drive away when I need answers.

But you can certainly use the internet to learn about the different loan programs in general and to help figure out what’s right for you

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