In the same period, adjustable-rate loans, with limits on rate changes, dropped to 8.50 percent from 8.66 percent.

So why risk rate increases by taking out a one-year adjustable-rate loan?

Some Web sites can help borrowers choose between fixed-rate and adjustable-rate loans.

Most adjustable-rate loans carry a low introductory interest rate that is below market rates.

"For a condominium, where prices are generally higher and there is no financial scrutiny, an adjustable-rate loan may make more sense."

Many are moving from adjustable-rate loans to fixed-rate mortgages, he added.

In the same period, adjustable-rate loans, with limits on rate changes, fell to 8.38 percent, from 8.42 percent.

But borrowers seeking adjustable-rate loans can no longer expect a bargain-basement price during the first year.

The couple pay about $800 a month on the adjustable-rate loan, which now charges about 10 percent interest.

In the next few months consumers will begin to feel the impact of the increase on their adjustable-rate home-equity, personal and mortgage loans.