Margin on an adjustable rate mortgage is the percentage point a lender adds to the index rate to determine the rate of interest. It is important for home buyers to understand all of the following basic features of an ARM Except:
Answer(s): D
It occurs when a principal balance on a mortgage loan increases because the monthly loan payment is lower than the amount of monthly interest being charged. What is it?
Answer(s): A
Two-step ARM is an adjustable rate mortgage with just two interest rates. One for the first years of the loan and the higher one for the remaining term of the loan:
Answer(s): C
Fixed rate mortgages are popular with home buyers who plan to stay in their homes for at least years and want to know what their payment will be.
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