An interest rate which varies based on an index.

Any interest rate that is subject to fluctutation. Movement above or below certain levels is often prevented by a preestablished floor and ceiling for a given rate. For example, you might see a rate set at "prime plus 3%". This means that the rate on the loan will always be 3% higher than the prime rate, which changes regularly to take into account changes in the inflation rate. For an individual taking out a loan when rates are low, a fixed rate loan would allow him or her to "lock in" the low rates and not be concerned with fluctuations. On the other hand, if interest rates were high at the time of the loan, he or she would benefit from an adjustable rate, because as the prime rate fell to historically normal levels, the rate on the loan would decrease.

A variable interest rate, as opposed to a fixed interest rate, that fluctuates according to the average interest rate on a specified security or market index.

A loan where the interest rate may change during the life of the loan, based on the movement of an index, resulting in changes in the payment amount.

With an adjustable rate mortgage, the interest rate is usually set for the first few years and then will vary depending on economic and factors written into the mortgage agreement. Often a clause is written into the mortgage to protect the borrower from excessive rate hikes. An adjustable rate is more risky, but could save a borrow money should the interest rate fall.

Mortgage interest rates that adjust periodically based upon changes in the corresponding index. Payments may increase or decrease accordingly.

A type of interest rate that changes from time to time based on changes in an index such as the average yield on one year Treasury Bills. Monthly payments can increase or decrease in relation to these average yields.

Refers to a type of interest rate or dividend that is changed periodically, due to changes in interest rates outside the control of the bank or savings institution, such as that prevailing on Treasury bonds or notes.

An interest rate that changes periodically in relation to an index. Payments may increase or decrease accordingly; a financing technique in which the lender can raise or lower the mortgage interest rate according to a set index, such as six-month Treasury bills.

A rate that fluctuates based on the relative movement of another rate. (Usually the prime rate.) · See Also · Line of Credit · Mortgage · Line of Credit

An interest rate that varies over time. Payments will be adjusted along with the rate.

an interest rate or dividend adjusted periodically to a standard market rate outside the control of the bank

An interest rate that changes periodically according to an index.

Adjustable-rate mortgage (ARM)

An interest rate that changes periodically in relation to an index. Payments may increase or decrease accordingly or in some cases the rate will stay the same at the adjustment period. The interest rate can change, monthly, every sixmonths, yearly or every 3 years, etc. depending on the terms of the adjustable rate mortgage.

An interest rate that changes periodically in relation to a defined index; like the Consumer Price Index. Payments may increase or decrease accordingly.

an interest rate that changes, based on changes in a published market-rate index.

An interest rate that adjusts periodically based on changes in a selected index.  Payments may increase or decrease accordingly.

Mortgages (ARM's) Mortgage loans in which the interest rate is periodically adjusted to more closely coincide with current rates. The amounts and times of adjustment are agreed to at the creation of the loan. Also called: Adjustable Rate Loans, Adjustable Mortgage Loans, Flexible Rate Loans, Variable Rate Loans.

An interest rate that is adjusted periodically according to a pre-selected index. Payments may increase or decrease accordingly.

An interest rate that changes periodically in relation to an index. Payments may increase or decrease accordingly. See Adjustable Rate Mortgages (below)

Interest rates that change periodically with the index they are "Tied" to. Payments may increase or decrease accordingly.

An interest rate that changes periodically in relation to an index (see Index). Payments may increase or decrease accordingly.

Mainly applies to convertible securities. Interest rate or dividend which is adjusted periodically, usually based on a standard market rate outside the control of the bank or savings institution such as that prevailing on treasury bonds or notes. Typically, such issues have a set floor or ceiling which limit the adjustment.

Adjustable-rate mortgage loan featuring an interest rate that moves up and down as market conditions change. ARMs generally offer a lower initial interest rate, but your mortgage payments may change (usually semiannually or annually). Rate changes are based on an index such as the one-year Treasury Index or the cost-of-funds index (COFi). Some ARMs can be converted to fixed rate.