Finance
A 'teaser rate' in an ARM loan is:
AA permanent low rate offered to first-time buyers
BA temporarily low initial rate designed to attract borrowers, which will reset higher✓ Correct
CThe maximum rate the ARM can reach
DA rate set below the index rate
Explanation
A teaser rate is a below-market introductory rate on an ARM loan that expires after a set period (often 6 months to 1 year), after which the rate resets to the market index plus margin.
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