An economic indicator that is used to determine changes in the interest rate of an Adjustable Rate Mortgage (ARM). U.S. Treasury Bills and notes are the most common but there are others. The rate is periodically adjusted to the index value plus a margin.
Protection against a specific loss over a period of time that is secured by the payment of a regularly scheduled premium.
The charge paid for borrowing money.
The amount of interest charged on a monthly loan payment; usually expressed as a percentage.