Qualifying for a short term rate or variable rate

If you are wishing for a standard 5 year fixed rate for your mortgage, the lender allow you to qualify using that discounted rate. If you are interested in a variable rate or a term of 1, 2, 3, or 4 years, you must be able to qualify using the Benchmark Rate (which is 5.34% today). This means that although the rate you are given is lower, to ensure you could still afford the home should interest rates increase in the next few years, lenders require that your application qualify using a higher rate.