Interest Rate Decrease Cap


Definition of "Interest Rate Decrease Cap"

Philip Curtis
Philip Curtis Equity Pennsylvania Real Estate

The maximum allowable decrease in the interest rate on an ARM each time rate is adjusted. It is usually one or two percentage points.

Have a question or comment? We're here to help.

 
 
 
*** Your email address will remain confidential.
 
 

Search Real Estate Terms

 

Popular Real Estate Terms

Government National Mortgage Association (GNMA)

A federal agency that guarantees mortgage securities that are issued against pools of FHA and VA mortgages. ...

Maximum Loan Amount

The largest loan size permitted on a particular loan program. For programs where the loan is targeted for sale to Fannie Mae or Freddie Mac, the max ...

Sub-Prime Lender

A lender who specializes in lending to sub-prime borrowers. ...

Total Expense Ratio

The ratio of total housing expense to borrower income. This ratio is used (along with other factors) in qualifying borrowers. ...

Servicing Agent

The party who services a loan, who may or may not be the lender who originated it. ...

Cost Of Savings Index

The monthly index is a ratio of monthly interest costs to total funds, expressed as a percentage. Annualized interest, the numerator, is calculated by ...

Popular Real Estate FAQ

What Is A Rate Lock?

A rate lock is a commitment issued by a lender to a homebuyer or to the mortgage broker guaranteeing a specific interest rate for a specified amount o ...

What Is A Spec House?

The textbook definition of a spec house is \"one built on a speculative basis, without an order on the books\". Commonly, a buyer will be unsatisfied ...

What Is A Title?

A title is the right of property ownership. ...

What Is Long Term Care Insurance?

Long-term care refers to a broad range of medical and personal care services designed to assist individuals who have lost their ability to perform act ...

What Is A Balloon Mortgage?

A type of mortgage in which the loan amount is amortized over the full length of the loan (usually 30 yrs), but the loan actually comes due after a fe ...

What Type Of Life Insurance Is Right For Me?

A life insurance policy can help enable your family to remain financially if you or your spouse should die. Insurance company understands that life is ...

Read why Real Estate Agent rates 5 Stars in 10 Agent Reviews
Read Reviews

Agents join here
Add our widget on your Website

Real Estate Advice

The Fine Line Between Representing Both the Buyer and Seller An Agent’s Guide on How to Plan the Perfect Open House Large Real Estate Companies vs Individual Agents or Small Companies How To Sell Your Home How Does The Home Loan Underwriting Process Work?

FAQ

What is principal? What is a title search? What are comparables or comps? What is PITI and what does it stand for? What is a gated community?