Finance
Iowa's adjustable-rate mortgage (ARM) caps limit which of the following?
AThe total number of payments over the loan term
BHow much the interest rate can increase per adjustment period and over the life of the loan✓ Correct
CThe lender's profit margin on the loan
DThe borrower's right to refinance
Explanation
ARM caps protect borrowers from extreme interest rate fluctuations. Periodic caps limit the rate change per adjustment period; lifetime caps limit the total increase over the loan's life.
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