Lifetime Cap

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Dictionary Says

Definition of 'Lifetime Cap'

The maximum interest rate on an adjustable-rate mortgage (ARM) that may be charged at any point over the life of the mortgage. The lifetime cap is usually expressed as a percentage increase from an initial interest rate. For example, if a fixed period ARM has an initial fixed interest rate of 5% and a lifetime cap of 5%, the maximum interest rate that may be charged is 10%. Lifetime caps are usually part of a mortgage's interest rate cap structure which consists of initial, periodic and life caps.
Investopedia Says

Investopedia explains 'Lifetime Cap'

Since ARMs derive their interest rates from a benchmark index, such as the London Interbank Offered Rate (LIBOR), lifetime caps limit the risks of substancial interest rate increases over the life of the mortgage. Initial and periodic caps limit the amount by which an ARM's interest rate can increase at any single interest rate adjustment date. 

Some mortgages have interest rate ceilings which are similar to, and sometimes referred to as, lifetime caps. However, an interest rate ceiling is usually expressed as an absolute percentage value. For example, the contractual terms of the mortgage may state that the maximum interest rate may never exceed 15%.
Search results for

'Lifetime Cap'

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    http://financialedge.investopedia.com/financial-edge/0411/Fixed-Or-Variable-Rate-Mortgage-Which-Is-Better-Now.aspx
    ... For example, this ARM has a maximum lifetime cap of 5%, which means that the interest
    rate cannot increase by more than 5% over the 30-year life of the loan. ...

  • Introducing The "Brand" Name Portfolio

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    ... Company. Market Cap. Sector/Industry. Yum Brands (NYSE:YUM). Large. Services/
    Restaurants. ... Small. Healthcare/Drug Related Products. Lifetime Brands (Nasdaq:LCUT). ...

  • Advanced Estate Planning: Reviewing Life Matters And Planning ...

    http://www.investopedia.com/university/estate-planning-guide/estate-planning7.asp
    ... in an amount of your choice as long as you stay under the maximum gift amount set
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    ... coffee of the day, I understand this will probably be a habit of a lifetime. ... Interactive
    Chart: Press Play to compare changes in market cap over the last two ...

  • 6 Ways To Maximize The Value Of Your 401(k)

    http://www.investopedia.com/articles/retirement/05/6WaysMax401.asp
    ... people will change jobs more than half-a-dozen times over the course of a lifetime. ...
    To cap off your efforts, use the tried and true strategy of "buy and hold ...

  • Got A Good Mortgage Rate? Lock It Up!

    http://www.investopedia.com/articles/pf/08/lock-mortgage-rate.asp
    ... That comes to $780 a year and $23,400 over the lifetime of a 30-year mortgage. ... This
    occurs because many lenders include a "cap" with the lock agreement. ...

  • 3 Great Stocks for Diversification

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    ... Again, we always want small-cap exposure, but we did pare it somewhat. ... 80s or 90s,
    but they have more than sufficient assets to last their lifetime, they wouldn ...

  • 8 Fund Types To Use In A Recession

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    ... tend to be less vulnerable than those that invest in small-cap stocks, as ... the odds
    of repeating that win over and over again throughout a lifetime of investing ...

  • This Week in Financial History: Bre-X, Silver Thursday And ...

    http://financialedge.investopedia.com/financial-edge/0310/This-Week-in-Financial-History-Bre-X-Silver-Thursday-And-Adelphia.aspx
    ... The samples had been heavily salted to make it appear like it was the find of a
    lifetime. The former penny stock reached a market cap of $6 billion, or over ...

  • Averaging Down Never Looked So Good

    http://stocks.investopedia.com/stock-analysis/2009/Averaging-Down-Never-Looked-So-Good-NOVA-DPZ-SNA-NOV1119.aspx
    ... Market Cap. Return Without Additions. ... How many times in your lifetime can you expect
    to get into the market at precisely the right time? Once or twice ... ...

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