Adjustable-Rate Mortgage - ARM

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Dictionary Says

Definition of 'Adjustable-Rate Mortgage - ARM'

A type of mortgage in which the interest rate paid on the outstanding balance varies according to a specific benchmark. The initial interest rate is normally fixed for a period of time after which it is reset periodically, often every month. The interest rate paid by the borrower will be based on a benchmark plus an additional spread, called an ARM margin.

An adjustable rate mortgage is also known as a "variable-rate mortgage" or a "floating-rate mortgage".
Investopedia Says

Investopedia explains 'Adjustable-Rate Mortgage - ARM'

Both 2/28 and 3/27 mortgages are examples of ARMs. A 2/28 mortgage's initial interest rate is fixed for a period of two years and then resets to a floating rate for the remaining 28 years of the mortgage. A 3/27 mortgage is typically the same as a 2/28 mortgage, except that the interest rate is fixed for three years and then floats for the remaining 27 years of the mortgage.
Search results for

'Adjustable-Rate Mortgage (ARM)'

  • Adjustable-Rate Mortgage Indexes: Know Your Benchmark

    http://www.investopedia.com/articles/mortgages-real-estate/10/mortgage-indexes-know-benchmark.asp
    ... April 15 2010 | Filed Under ยป Banking, Real Estate. Adjustable-rate mortgages (ARM)
    are a type of mortgage in which the interest rate paid on the outstanding ...

  • Mortgages: Fixed-Rate Versus Adjustable-Rate

    http://www.investopedia.com/articles/pf/05/031605.asp
    ... Payment Structure.) Adjustable-Rate Mortgages The interest rate for an
    adjustable-rate mortgage varies over time. The initial interest rate on an ARM is ...

  • When (And When Not) To Refinance Your Mortgage

    http://www.investopedia.com/articles/pf/05/033005.asp
    ... to obtain a lower interest rate; the chance to shorten the term of their mortgage;
    the desire to convert from an adjustable-rate mortgage (ARM) to a fixed-rate ...

  • How Interest Rates Affect The Housing Market

    http://www.investopedia.com/articles/pf/07/mortgage_rate.asp
    ... help consumers make financially sound mortgage decisions, such as making the choice
    between a fixed-rate mortgage or adjustable-rate mortgage (ARM) or deciding ...

  • What is the difference between a 2/28 and a 3/27 ARM?

    http://www.investopedia.com/ask/answers/07/difference-ARMs.asp
    ... An adjustable rate mortgage (ARM) is a type of mortgage that has a fixed interest
    rate for a certain time period at the beginning of the mortgage, which then ...

  • This ARM Has Teeth

    http://www.investopedia.com/articles/pf/07/arm-reset.asp
    ... While there is a bewildering array of mortgages, this article focuses on
    one type - the adjustable-rate mortgage, or ARM for short. ...

  • Mortgage Basics: Variable-Rate Mortgages | Investopedia

    http://www.investopedia.com/university/mortgage/mortgage2.asp
    ... mortgage, also commonly referred to as an adjustable-rate mortgage or a
    floating-rate mortgage, is a loan in which the rate of interest is subject to change. ...

  • What is a subprime mortgage?

    http://www.investopedia.com/ask/answers/07/subprime-mortgage.asp
    ... The most common is the adjustable rate mortgage (ARM), which initially charges a
    fixed interest rate, and then convert to a floating rate based on an index ...

  • Option ARMs: American Dream Or Mortgage Nightmare?

    http://www.investopedia.com/articles/pf/07/optionarms.asp
    ... And Dangerous, Mortgages: Fixed-Rate Versus Adjustable-Rate and Paying Off Your
    Mortgage.) The Options ... required payment for an option ARM is extremely ...

  • 5 Risky Mortgages To Avoid Slideshow | Investopedia

    http://www.investopedia.com/slide-show/5-risky-mortgages/adjustable-rate-mortgage.aspx
    ... Taking out a 40-year mortgage increases your risk ... Adjustable rate mortgages (ARMs)
    have a fixed interest rate for ... the monthly payments under an ARM will become ...

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