Rising mortgage interest rates affect how much home a potential buyer can afford to purchase and how much equity homeowners can afford to tap through refinancing and equity-backed loans. Although rates are still very affordable this year from an historical standpoint, there are a number of ways you can pull down an even better rate.

While many people fear adjustable-rate mortgages (ARMs), they can save a home buyer lots of money in certain circumstances. ARMs offer lower rates than fixed-rate loans ... sometimes considerably lower. A 1-year ARM will hold its initial rate for a year, but then may be adjusted annually (up or down) according to movements in the index it is tied to. Also available are 3, 5, and 7-year ARMs, which hold the initial rate for 3, 5 or 7 years, and then adjust annually. If you don't plan to be in the home more than these number of years, you can enjoy a substantially lower monthly payment.

Hybrid loans, such as the 5/25 and 7/23 mortgage programs hold the initial interest rate fixed for 5 or 7 years, then adjust once to a new fixed rate for the loan's remaining 25 or 23 years, based on a formula specified in the loan agreement.

Paying more points (also called "loan discount" fees) allows you to buy down the interest rate. Be sure you'll live in the home long enough for payment savings to recoup the cost of points paid.

It's a good idea to seek discounts from lenders competing for your business during any upsurge in rates.