FPM - Flexible-Payment Mortgage
The definition of mortgage term: Flexible-Payment Mortgage
A flexible-payment mortgage is a type of ARM that allows the borrower to choose from a variety of payment options. These Payment options are a traditional 30 or 15 year amortizing payment plan, interest only, or minimum payments. The interest only loan allows the borrower to pay the interest that is incurred each month for the first 5 or so years. After which the payments must be larger enough to pay off the principle within the term of the loan. the minimum payments plan allows borrowers to pay the same payment that they had during the fixed period of the ARM even after their rate has increased. This can often cause the mortgage to have a higher balance than before payments initialized.
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