Adjustment Frequency

Adjustment Frequency

In adjustable-rate mortgages, the rate at which changes to a mortgage's interest rate occur. Usually, the interest rate changes once a year, but some mortgages change rates as often as once a month or as seldom as every five years. The higher the adjustment frequency, the higher the financial risk for the homeowner. For example, if the adjustment frequency is once a month, a homeowner could find his/her mortgage payment increasing every month for five months before it goes down again. This ties up more of the homeowner's income, and increases the likelihood of default.
References in periodicals archive ?
where [f.sub.ref] is the storage system's reference frequency, [f.sub.main] is the main grid's frequency, and [DELTA]f is the minor adjustment frequency, which can be set to 0.05 Hz; the selection of addition or subtraction depends on the initial phase angle difference, which can be set as subtraction;
Of all the studies of price adjustment frequency from data generated under moderate inflation, Anil Kashyap's (1995) analysis of prices in catalogs covers the longest period of time, from 1953 to 1987.
When costs vary with adjustment frequency, price changes may become smaller as inflation rises, as evidenced by Lach and Tsiddon |1992~.
The analysis of the relationship between inflation and adjustment frequency is in section IV.
It needs to be used in concert with other adjustment frequency methods.