PBA Tip of the Day brought to you by Steve and Connie Moss with Future Financial 623-551-4734.
What is an adjustable rate mortgage or an ARM and is it the same as a balloon mortgage. Steve and Connie have the answer!
No these two mortgages are not the same. An ARM is a mortgage in which the interest rate is adjusted periodically based on a pre-selected index. Also sometimes known as the re-negotiable rate mortgage, the variable rate mortgage or the Canadian rollover mortgage. Whereas, a balloon mortgage is usually a short-term fixed-rate loan which involves small payments for a certain period of time and one large payment for the remaining amount of the principal at a time specified in the contract. For more information about mortgages, contact Future Financial today!