Finance
What is the primary difference between a fixed-rate mortgage and an adjustable-rate mortgage (ARM) in Delaware?
AFixed-rate mortgages are only available from Delaware state banks; ARMs are available from national lenders
BA fixed-rate mortgage has an interest rate that never changes; an ARM has an interest rate that adjusts periodically based on a market index✓ Correct
CFixed-rate mortgages have shorter terms than ARMs
DARMs have higher initial rates than fixed-rate mortgages
Explanation
A fixed-rate mortgage maintains the same interest rate for the entire loan term, providing payment predictability. An adjustable-rate mortgage (ARM) has an initial fixed rate period followed by periodic adjustments tied to a market index (e.g., SOFR), which can cause payments to increase or decrease.
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