Homeowners who secured adjustable-rate mortgages (ARMs) when interest rates were near historic lows may be in for an unpleasant surprise. As those introductory rates expire, some borrowers could see their monthly mortgage payments jump by hundreds of dollars or more.

Unlike fixed-rate mortgages, ARMs have interest rates that can change periodically after an initial fixed-rate period. For homeowners who locked in rates around 3% during the pandemic, the first adjustment could create a significant strain on their budgets.

Refinancing into a fixed-rate mortgage may seem like the easiest solution, but today's rates could make that an expensive move. Fortunately, there are other ways to prepare. Here are five steps to take before your ARM resets.

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