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Simple English definitions for legal terms
FRM
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A quick definition of FRM:
A mortgage is a loan that you take out to buy a property. It's like a promise that you make to the bank or lender that you will pay back the money you borrowed, plus interest, over a certain period of time. If you don't pay back the money, the lender can take your property away. There are different types of mortgages, like fixed-rate mortgages where the interest rate stays the same, and adjustable-rate mortgages where the interest rate can change. It's important to understand the terms of your mortgage before you sign up for one.A more thorough explanation:
Definition: FRM stands for fixed-rate mortgage. It is a type of mortgage where the interest rate remains the same throughout the life of the mortgage, regardless of market conditions.
Example: If a borrower takes out a 30-year FRM with an interest rate of 4%, the interest rate will remain at 4% for the entire 30-year term, even if interest rates in the market increase or decrease.
Explanation: This means that the borrower's monthly mortgage payments will remain the same for the entire term of the mortgage, providing stability and predictability in their budgeting. The example illustrates how the interest rate remains fixed, regardless of market conditions.