Finance
An Arizona borrower obtains a loan where the interest rate can change periodically based on an index. This is called a:
AFixed-rate mortgage
BAdjustable-rate mortgage (ARM)✓ Correct
CBalloon mortgage
DWraparound mortgage
Explanation
An adjustable-rate mortgage (ARM) has an interest rate that adjusts periodically — typically annually — based on a specified financial index, causing the monthly payment to increase or decrease.
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