Adjustment Interval

Adjustment Interval

In adjustable-rate mortgages and variable-rate mortgages, the time between two changes in the interest rate of the mortgage or loan. Often, the adjustment interval lasts one year, but some loans change rates as often as once a month or as seldom as every five years. The shorter the adjustment interval, the higher the financial risk is for the homeowner. For example, if the adjustment interval for a mortgage is one month, a homeowner's mortgage payment could increase every month for five months or longer before it decreases again. This ties up more of the homeowner's income, and increases the likelihood of default.

Adjustment Interval

On an ARM, the time between changes in the interest rate or monthly payment.

These are the same on a fully amortizing ARM, but may not be on a negative amortization ARM. See Adjustable Rate Mortgage.

References in periodicals archive ?
Furthermore, in most specifications, the unweighted average price adjustment interval for all industries is below 1 yr, and the weighted average--using industry shares of total sales as weights--price adjustment interval for all specifications ranges from no higher than 3.
Their aggregate parameter estimates imply a relatively lengthy average price adjustment interval, typically at least 6 quarters in the case of U.
The adjustment interval, or the time between changes in your mortgage's interest rate.
You may be comfortable foregoing a longer adjustment interval or stringent caps, while instead searching for the lowest possible initial interest rate.
The TOLQC model for variable characteristics with feedback control system which the adjustment interval is more than one production unit considers the following costs and losses as the yardsticks for the evaluation of quality costs of the production system:
The summation of diagnosis cost, adjustment cost and loss due to deviation constitute the TOLQC model for variable characteristics with adjustment interval more than one unit of production.
First note that the exponent of 1/3 in (9) implies that third-order price adjustment costs have first-order effects on the optimal price adjustment interval.
However, adjusting the panels manually eliminates the extra cost and yields better results when the adjustment intervals are optimized for local conditions, the researchers say.
This makes for long adjustment intervals, since the abrasion limit is not prematurely reached due to non-infinitely variable setting and play movement
Chapter 6, on inflation, clearly presents the monetarism-structuralism debate and five factors in the inflation process: seignorage, balance-of-payments crises, dollarization, capacity constraints and supply shocks, and indexation and adjustment intervals.
Adjustment intervals typically range from one month to five years.
The main reason good-quality scopes "fail" in normal use (reticles break or turn, lenses become loose, zoom mechanisms bind, adjustment intervals become irregular) is because the tube is stressed--slightly "bent"--by being held tightly by misaligned rings.