Finance
A New Mexico buyer obtains a loan where the interest rate can change periodically based on a financial index. This is called a(n):
AFixed-rate mortgage
BAdjustable-rate mortgage (ARM)✓ Correct
CBalloon mortgage
DInterest-only mortgage
Explanation
An adjustable-rate mortgage (ARM) has an interest rate that can adjust periodically based on a financial index (such as the SOFR), which may cause the monthly payment to increase or decrease.
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