What is the term for the date when a new monthly payment amount takes effect on an Adjustable Rate Mortgage (ARM) or a Graduated Payment Mortgage (GPM)?

The term that describes the date when a new monthly payment amount takes effect on an Adjustable Rate Mortgage (ARM) or a Graduated Payment Mortgage (GPM) is known as the Payment Change Date. This date is crucial for borrowers, as it signifies when the borrower will begin paying the new calculated amount based on the adjustments to the interest rate or payment structure.

In the context of an ARM, after an initial fixed-rate period, the interest rate may change periodically based on the performance of a specific index, which subsequently leads to a recalculation of the monthly payment. Similarly, in a GPM, the payment increases are structured to escalate over time, creating a predetermined schedule for when the new payment amounts are effective. Understanding the Payment Change Date is essential for borrowers to manage their financial planning effectively, ensuring they are prepared for adjusted payment amounts.

The other terms listed refer to different aspects of mortgage agreements. The Adjustment Date typically pertains to when the interest rate adjustment takes place rather than the payment change itself. Rate Change Date also focuses specifically on when the interest rate is set to change, while Monthly Payment Date generally refers to when payments are due rather than when they adjust. Therefore, the Payment Change Date accurately captures the essence of the transition to a new payment