Finance
What is a convertible ARM mortgage?
AA car loan convertible to a home loan
BAn adjustable-rate mortgage with an option to convert to a fixed rate at specified times✓ Correct
CA construction loan convertible to permanent financing
DAn ARM with a balloon payment that converts
Explanation
A convertible ARM starts as an adjustable-rate mortgage but includes an option to convert to a fixed-rate mortgage at specified dates (often during years 2-5). This offers initial ARM flexibility with the security of converting to fixed later.
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