teaser rate
An initial, relatively low, rate of interest on an adjustable-rate mortgage designed to attract borrowers.

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  • teaser rate — A low initial interest rate on an adjustable rate mortgage to entice borrowers, that is later eliminated and replaced by a market level rate. Bloomberg Financial Dictionary * * * teaser rate teaser rate ➔ rate1 * * * teaser rate UK US noun [C]… …   Financial and business terms

  • Teaser Rate — An initial rate on an adjustable rate mortgage (ARM). This rate will typically be below the going market rate, and is used by lenders to entice borrowers to choose ARMs over traditional mortgages. The teaser rate will be in effect for only a few… …   Investment dictionary

  • teaser rate — / ti:zə reɪt/ noun a specially good interest rate on a new product, used to encourage savers to switch funds to that product. It is replaced by a normal rate when enough subscribers have invested in it …   Dictionary of banking and finance

  • rate — The cost of debt service paid by a borrower or issuer to a lender or investor. The rate is expressed as an annual percentage of the amount borrowed. For some notes and bonds that pay interest semiannually, the semiannual interest due to the… …   Financial and business terms

  • teaser — A teaser rate is a below market interest rate offered to borrowers of adjustable rate loans during the initial period of some adjustable rate mortgages. A teaser period is the period of time during which the teaser rate applies. American Banker… …   Financial and business terms

  • Teaser Loan — An adjustable rate mortgage loan in which the borrower pays a very low initial interest rate, which increases after a few years. Teaser loans try to entice borrowers by offering an artificially low rate and small down payments, claiming that… …   Investment dictionary

  • teaser —  A low introductory rate on a loan, or a high initial rate on a deposit …   American business jargon

  • Adjustable-rate mortgage — A variable rate mortgage, adjustable rate mortgage (ARM), or tracker mortgage is a mortgage loan with the interest rate on the note periodically adjusted based on an index which reflects the cost to the lender of borrowing on the credit… …   Wikipedia

  • Initial Interest Rate — The interest rate that is initially assessed on an adjustable rate mortgage (ARM) and advertised in the origination process. The initial interest rate will be in force for a limited period of time, typically between 12 and 24 months. After this… …   Investment dictionary

  • Option Adjustable-Rate Mortgage - Option ARM — A type of mortgage where the mortgagor (borrower) has several options as to which type of payment is made to the mortgagee (lender). In addition to having the choice of making payments of interest and principal that amounts to those made in… …   Investment dictionary

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