Home Categories Home Ownership A loan at 125% is a mortgage loan equal to 1.25 times the value of the property securing the loan. A 2-1 buyout is a type of financing that lowers the mortgage interest rate for the first two years before it rises to a regular, constant rate. 2/28 adjustable rate mortgages (ARM) offer an initial fixed rate for two years, after which the interest rate is adjusted semi-annually for another 28 years. With a 3-2-1 buyout mortgage, the borrower pays a lower interest rate for the first three years in exchange for an upfront payment to the lender. The 3/27 Adjustable Rate Mortgage (ARM) is a 30-year mortgage with a three-year fixed rate period. A 5/6 Adjustable Rate Hybrid Mortgage (ARM 5/6 Hybrid) is a fixed rate mortgage for the first five years and then adjusted every six months thereafter. Adjustable Rate Hybrid Mortgages (ARM) 5/1 offer an initial fixed rate for five years, after which the interest rate is adjusted annually. An arrears rate of more than 60 is a metric commonly used to measure the number of mortgages that are more than 60 days overdue on monthly payments. An 80-10-10 mortgage consists of two mortgages: the first is a fixed-rate loan of 80% of the value of the home; the second - 10% as a loan secured by equity capital; and the remaining 10% as a down payment in cash. An adjustable rate mortgage (ARM) is a home loan with an interest rate that may fluctuate from time to time based on a certain benchmark.