Cap

A limit, such as one placed on an adjustable rate mortgage, on how much a monthly payment or interest rate can increase or decrease, either at each adjustment period or during the life of the mortgage. Payment caps do not limit the amount of interest the lender is earning, so they may cause negative amortization.

A cap is a form of headgear. Caps have crowns that fit very close to the head and have no brim or only a visor. They are typically designed for warmth and, when including a visor, blocking sunlight from the eyes. They come in many shapes and sizes.