Adjustable-rate mortgages are making a comeback in the Bay Area as home prices continue to rise. However, this option also carries considerable risk.

Real estate agents say more people want the freedom to adjust in today’s high and climbing mortgage rate market.

“There’s definitely a trend and a curiosity of adjustable-rate mortgages,” Silicon Valley real estate broker Lynsie Gridley said.

What a buyer pays for an adjustable-rate mortgage starts considerably lower than most fixed-rate mortgages.

“The spread, or the difference between a fixed rate and an adjustable rate, is often ¾ to 1% difference in rate,” Redwood Credit Union Mortgage Lending Senior VP Debbie Ingle said.

That could mean saving more than $1,000 a month in the Bay Area, or about $100,000 in seven years. But because the rate is adjustable, it moves – and that means it comes with a potential dark side.

“There is upside risk, because they don’t know where it’s gonna go, they know how long it’s locked at this rate, and then you know you’ll be eventually adjusting and it can adjust up or down,” Gridley said.

“You don’t have that level of, ‘I can relax, I’ve got a 30-year fixed payment.’ You have to stay abreast of what’s happening in the real estate market and with interest rates,” Ingle said.