Before taking out your first time home mortgage, you have many things to think about. Here's one: Do you (1) Go for the safe, but pricey option? Or do you (2) Go for more affordable and take a bit of a risk?

Adjustable rate mortgages are all about option (2). How big a risk you take, depends on the type of mortgage and what you do with it.

Adjustable rate mortgages have interest rates that go up and down. The amount of money you pay each month therefore goes up and down. It might seem a little insane but with a little know-how, you can use adjustable rate mortgages to get an awesome deal on your first home.

How?
Well, these mortgages usually have big discounts in interest rate. At first. That makes them a lot more affordable in the beginning.

This type of mortgage is what has made buying their first home at all possible. For a lot of people.

Some people buy their first homes with adjustable rate mortgages, knowing that their income will soon increase to accommodate any changes.

Other have invested in do-er uppers, used the cheap part of adjustable rate mortgages while doing the houses up, and then sold before the payments went up. That way, they have made enough cash for a nice sized down payment on the home of their dreams.

Probably the majority of people with adjustable rate mortgages have them because it makes the home they've fallen in love with, affordable. If that's your situation, you must remember: The one big problem with adjustable rate mortgages is what happens after those delicious discounts expire.

So what does happen?
The monthly payments bounce up. Sometimes quite sharply. And then they keep right on bouncing about. And that can play havoc with your peace of mind.

How to bring sanity to this chaos
The question you need to answer, if you're considering an adjustable rate mortgage, is this: Are you also preparing for the certain rise in mortgage payments? Have you made a note, in lots of conspicuous places, reminding you to confirm the date your interest rate will increase, and reminding you to put the date in your diary?

Doing just that, as soon as you sign for the mortgage, could save you a heap of grief several years down the line when you're busy living your life with a million other (hopefully wonderful) concerns.