Finance
An adjustable-rate mortgage (ARM) in Ohio includes a 'cap' provision that:
AFixes the rate for the entire loan term
BLimits how much the interest rate can change per adjustment period and over the life of the loan✓ Correct
CRequires the lender to notify the borrower before any rate change
DGuarantees the rate will never exceed the initial rate
Explanation
ARM caps limit rate changes. Periodic caps limit changes per adjustment period; lifetime caps limit total changes over the loan term. These protect borrowers from extreme payment increases.
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