- An adjustable rate mortgage (ARM) that can be converted to a fixed-rate mortgage under specified conditions.
changeable, modifiable, swappable, able to be changed
Related Terms and Acronyms
- Adjustable-Rate Mortgage (ARM) — Acronym,
➥ A type of variable rate mortgage product.
- A type of mortgage loan program in which the interest rate and payments may be adjusted as frequently as every month. The principal loan balance or term of the loan may also be adjusted to reflect the rate change. The purpose of the program is to allow mortgage interest rates to fluctuate with market conditions.
- Convertible Mortgage — Definition, Important,
- A mortgage where the borrower has the option at specified times to change the term length.
- Initial Interest Rate — Definition,
- The introductory interest rate on an adjustable-rate mortgage (ARM), which usually changes at a predetermined time.
- Periodic Rate Cap — Definition,
- In an adjustable-rate mortgage (ARM), it limits how much an interest rate can increase or decrease from one adjustment period to the next.
- Variable Rate Mortgage (VRM) — Acronym, Very Important,
➥ A type of mortgage loan offered by brokers and lenders.
- Home loan in which the interest rate is changed periodically based on a standard financial index. Also called an "Adjustable-rate Mortgage."