Definitions for "Adjustment Cap"
Keywords:  cap, brought, maximum, per, limits
the maximum amount that an interest rate can adjust each period. (usually 1% per 6 months or 2% per year)
The adjustment cap on an ARM mortgage is the maximum amount the interest rate can increase from any previous adjustment, not including the first adjustment. For example, if you had an adjustment cap of 2%, and your last rate adjustment brought you to 6%, the your next rate could increase to a maximum of 8%.
See Cap Rates.