With interest rates rising, fewer people are applying for new mortgages – just as you’d expect.

But here’s a worrisome surprise: More of the applicants are seeking adjustable-rate mortgages that could saddle them with bigger monthly payments if rates keep going up.

Clearly, many borrowers are using adjustable loans, or ARMs, to borrow more than they could with fixed ones. That means they may be taking on more debt than they should.

And I suspect some are placing a risky bet that rates will fall in a year or two, reducing monthly payments on ARMs taken out today. Given past patterns, however, it could be several years before rates fall substantially below where they are today, and they could rise in the meantime.

Today’s ARMs are a bad deal. If you’re shopping for a mortgage, the standard 30-year, fixed-rate type is almost certainly your best bet. It charges the same rate for its entire term – up to 30 years.

The Mortgage Bankers Assn. recently reported that lenders had received 6.2 percent fewer applications in the week ended May 19 than a week earlier. Applications were down a whopping 23 percent from the same week a year ago.

Rising interest rates are obviously discouraging some people from buying homes or refinancing older mortgages. A year ago, you could get a fixed-rate, 30-year mortgage for 5.9 percent. Now it will cost around 6.6 percent.

That’s still a pretty good deal, as rates often have been considerably higher.

Yet ARMs accounted for 30.5 percent of those recent applications, the highest share since January, the bankers’ association said.

The typical ARM starts with a low “teaser” rate – currently around 6 percent – that gives the borrower a smaller monthly payment than he or she would have with a fixed-rate loan of the same size with a higher rate. The lower starting payment allows the applicant to qualify for a larger loan.

Because home prices have soared in recent years, many borrowers are stretching to the limit to get the properties they want. But even if the lender will allow it, taking the biggest loan you can get could leave you in trouble if something goes wrong, such as if you lose a job or are hit by a big expense.

Most ARMs set new rates every 12 months. That’s usually done by adding 2.75 percentage points to some base level, such as the current interest rate on U.S. Treasury bills with one year to maturity.

If the one-year Treasury goes to 6 percent – a level it’s often been at in the past – ARM rates being re-set a year from now could go to 8.75 percent. Homeowners with ARMs will kick themselves for not locking in the 6.6 percent they can get on a fixed loan today.