An Adjustable Rate Mortgage (ARM) loan is any mortgage loan program that allows the lender to periodically reset or adjust the loan's interest rate, according to agreed measurements and at pre-set periods.
Don't worry, though. The mortgage lender will not have free reign with the adjustments. Today's ARM loan borrowers actually have several protections built into the residential ARM loan program. However, that has not always been the case. In fact, the ARM loan as we know it today is a fairly recent introduction into the mortgage loan market.
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