index: Glossary of Mortgage Products Part 2: Adjustable Rate Mortgages - 03/08/08 03:16 PM
Adjustable Rate Mortgage (ARM): An ARM is a mortgage with an interest rate that may vary over the term of the loan -- usually in response to changes in the prime rate or Treasury Bill rate. The purpose of the interest rate adjustment is primarily to bring the interest rate on the mortgage in line with market rates.
Mortgage holders are protected by a ceiling, or maximum interest rate, which can be reset annually. ARMs typically begin with more attractive rates than fixed rate mortgages -- compensating the borrower for risk future interest rate fluctuations.
Choosing an ARM is a good idea when:
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Zach Dahl, Virginia Home Loans (Ameritime Mortgage Company, LLC.)

Zach Dahl

Virginia Home Loans

Charlottesville, VA

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Ameritime Mortgage Company, LLC.

Address: 313 2nd Street SE, Suite 112, Charlottesville, VA, 22902

Mobile: (703) 864-5257

Office: 877(296) 775-1204

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