Finance
What is an adjustable-rate mortgage (ARM)?
AA mortgage with a rate fixed for the entire loan term
BA mortgage where the interest rate changes periodically based on a market index✓ Correct
CA mortgage that allows extra payments without penalty
DA mortgage backed by the government
Explanation
An adjustable-rate mortgage (ARM) has an interest rate that adjusts periodically, typically tied to an index like SOFR or Treasury rates. ARMs often start with a lower introductory rate.
Related Delaware Finance Questions
- What is 'forbearance' in a Delaware mortgage and when is it used?
- Loan-to-value (LTV) ratio is calculated as:
- Under the Community Reinvestment Act (CRA), banks are required to:
- What is 'predatory lending' and how does Delaware protect borrowers?
- A reverse mortgage allows:
- What is a '1031 exchange' (like-kind exchange) and can Delaware investment property owners use it?
- What is 'Delaware State Housing Authority' (DSHA) and how does it help homebuyers?
- What is 'loss mitigation' in Delaware mortgage servicing?
Practice More Delaware Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Delaware Quiz →