Option ARM
- A kind of flexible mortgage in which a borrower chooses their monthly payment, typically from four possibilities: a minimum payment based on an initial interest rate, a payment addressing the interest accrued that month, or a full payment spread over 15 or 30 years
- Under his Option ARM, John opted for a minimum payment based on the initial interest rate.
- With her Option ARM, she decided to make payments that covered the accumulated interest for the month.
- Opting for a full 30-year amortizing payment, they utilized their Option ARM to diminish their monthly expenses.
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