Variable Rate

A variable rate is an interest rate that adjusts over the life of a loan based on a reference index (Prime, SOFR, Treasury yields) plus a fixed margin. Variable rates can move monthly, quarterly, or annually depending on the loan terms.

Variable rates start lower than equivalent fixed rates and benefit the borrower if benchmark rates fall — but expose the borrower to rate-rise risk. Adjustable-rate mortgages (ARMs), HELOCs, and most open-term DeFi crypto loans use variable rate structures.

Why it matters for Milo customers

Milo's mortgages and crypto-backed loans are typically fixed rate at origination. The exception is some ARM mortgage products. Borrowers wanting predictability through Bitcoin price cycles generally prefer fixed-rate Milo structures over variable-rate DeFi alternatives.

---