What is teaser rate?
An introductory ARM rate set below the fully indexed rate. At the first adjustment the loan may reset toward index + margin, subject to caps, even if the index has not moved.
Where you will use it: this term comes up in the Real Estate Finance course, and the full course glossary collects every term in one place.
Related terms
From the free Real Estate Finance course by Devon Coombs, CPA, MBA.