Adjustable Rate Mortgage (ARM)

A mortgage ( www.practicallaw.com/0-382-3636) loan in which the interest rate on the note ( www.practicallaw.com/3-382-3654) periodically fluctuates based on listed indexes. Certain indexes are more commonly used, including the London Interbank Offered Rate ( www.practicallaw.com/0-382-3580) (LIBOR) and the Cost of Funds Index (COFI). However, some lenders tie ARMs to their own cost of funds indexes instead. ARMs often contain limitations (caps) on what a borrower can be charged as interest rates rise.

{ "siteName" : "PLC", "objType" : "PLC_Doc_C", "objID" : "1247354985486", "objName" : "Adjustable Rate Mortgage", "userID" : "2", "objUrl" : "http://us.practicallaw.com/cs/Satellite/us/resource/9-502-1272?null", "pageType" : "Resource", "academicUserID" : "", "contentAccessed" : "true", "analyticsPermCookie" : "25e8a493e:15b1865425a:-1da6", "analyticsSessionCookie" : "25e8a493e:15b1865425a:-1da5", "statisticSensorPath" : "http://analytics.practicallaw.com/sensor/statistic" }