For Adjustable-rate Mortgage (Arm) we have terms and definitions in 5 topics. The topics are Finance, Homeowners Insurance, Mortgage, Purchasing A Home and Real Estate.

Adjustable-rate Mortgage (Arm) (Finance)

A mortgage that features predetermined adjustments of the loan interest rate at regular intervals based on an established index. The interest rate is adjusted at each interval to a rate equivalent to the index value plus a predetermined spread, or margin, over the index, usually subject to per-interval and to life-of-loan interest rate and/or payment rate caps.

Adjustable-rate Mortgage (Arm) (Homeowners Insurance)

ARMs start off with a low, fixed interest rate and fixed monthly payments, but later adjust to reflect prevailing market interest rates. Borrowers get the advantage of starting with a low interest rate, but take the risk that interest rates may increase dramatically sometime during the life of the loan.

Adjustable-rate Mortgage (Arm) (Mortgage)

A mortgage where the interest rate is not fixed, but changes during the life of the loan in line with movements in an index rate. You may also see ARMs referred to as AMLs (adjustable mortgage loans) or VRMs (variable-rate mortgages).

Adjustable-rate Mortgage (Arm) (Purchasing A Home)

A mortgage that permits the lender to adjust its interest rate periodically on the basis of changes in a specified index.

Adjustable-rate Mortgage (Arm) (Real Estate)

An ARM is classified as a loan with a fluctuating interest rate. In other words, the interest rate moves up and down as market conditions fluctuate. Typically, an ARM will afford a lower initial interest rate, but your mortgage payments may change (usually semiannually or annually).

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