Pre-determined rate of interest that will be applied to the loan until the date of the first interest rate change.

The initial interest quoted on an Adjustable Rate Mortgage (ARM). WARNING: This may not be the fully indexed rate. That means that even if interest rates in the market are steady, your rate may increase in the future.

Initial interest rate of the ARM.

The initial interest rate charged on an adjustable-rate mortgage loan.

Referred to as a teaser rate, it's the starting interest rate of an adjustable rate loan. This rate usually lasts between one and twelve months, then the rate increases based on prearranged criteria.

See initial interest rate.