In considering a 3/1 adjustable-rate mortgage (ARM), the interest rate will be fixed for how many years?
A) One year
B) Two years
C) Three years
D) Four years

Question

Quizplus · Accepted Answer

In a 3/1 ARM, the interest rate is fixed for the first three years and then adjusts annually based on a specific financial index. Therefore, the best choice is option C, as it correctly states the initial fixed period for the ARM. Options A, B, and D are incorrect as they suggest different fixed periods that do not align with a 3/1 ARM.

In Considering a 3/1 Adjustable-Rate Mortgage (ARM), the Interest Rate