|Adjustable Rate Mortgage (ARM)|
A mortgage whose interest rate changes over time based on an index and a margin. Rate changes are made at prescribed times and within prescribed limits (caps) as defined in the mortgage contract.
A real estate loan with a lien (i.e., mortgage or deed of trust) on the subject property that has priority over any subsequently lien or financial encumbrances.
|Home Equity Line of Credit (HELOC)|
A revolving line of credit secured on the equity in the mortgagor's house, usable for any purpose.
Interest which is computed only on the principle balance.