General Mortgage KnowledgeQuestion 171 of 400
Which of the following is an example of an index that can be used to set the rate on an adjustable-rate mortgage?
a.The loan's margin
b.The borrower's FICO score
c.SOFR (Secured Overnight Financing Rate)
d.The origination fee
Explanation
SOFR is a common market index used to adjust ARM rates. The margin is added to the index (not the index itself), and the FICO score and origination fee are unrelated to the ARM index.
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