Finance
An adjustable-rate mortgage (ARM) differs from a fixed-rate mortgage in that:
AThe ARM always starts at a higher rate
BThe ARM's interest rate can change periodically based on a market index✓ Correct
CThe ARM requires a larger down payment
DThe ARM cannot be refinanced
Explanation
An ARM has an interest rate that adjusts periodically based on a specified index (e.g., SOFR, CMT). The initial rate may be lower than a fixed rate, but it can increase over time.
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