Any mortgage other than a fixed-interest-rate, level-payment amortizing loan. AMIs provide unique approaches to mortgage lending, often accommodating borrowers with non-traditional income streams or financial situations.
Refinancing refers to the process of replacing an existing mortgage with a new one, typically to secure better loan terms such as a lower interest rate or a different type of loan structure. Often abbreviated as 'refi,' this process involves paying off an old loan with a new loan, typically to take advantage of lower interest rates, different loan terms, or to switch from a variable-rate mortgage to a fixed-rate mortgage.
A variable interest rate is an interest rate on a loan or security that fluctuates over time because it is based on an underlying benchmark interest rate or index that changes periodically.
A Variable-Payment Plan is a mortgage repayment schedule that allows for periodic changes in monthly payments. These changes can result from the expiration of an interest-only period, a planned step-up in payments, or fluctuations in an interest rate index.
A Variable-Rate Mortgage (VRM) is a long-term mortgage loan applied to residential properties, under which the interest rate adjusts on a scheduled basis, typically every six months. Rate increases are restricted to no more than ½ point per year and a total of 2½ points over the Term. The term Adjustable-Rate Mortgage (ARM) is now more commonly used.
A Variable-Rate Mortgage (VRM) is a real estate loan in which the interest rate applied on the outstanding balance varies throughout the life of the loan. The rate adjustments are based on predetermined benchmarks such as the prime rate or U.S. Treasury rates.
