Question

What do balloon mortgage and ARM have in common?

Answer 1

In other respects, a balloon mortgage resembles an adjustable rate mortgage (ARM) with an initial rate period equal to the balloon period. A 7-year balloon, for example, is usually compared to a 7-year ARM. Both have a fixed-rate for 7 years, after which the rate will be adjusted.

Explanation:

Answer 2

Both are subject to current market rate after the initial rate period.

Explanation: