Finance
An adjustable-rate mortgage (ARM) in Maryland has a 5/1 structure. This means:
AThe rate is fixed for 1 year then adjusts every 5 years
BThe rate is fixed for 5 years then adjusts annually✓ Correct
CThe loan has 5 payment caps and 1 lifetime cap
DThe loan amortizes over 5 years
Explanation
A 5/1 ARM has a fixed interest rate for the first 5 years, then adjusts annually based on a specified index plus margin.
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