Elizabeth and Rick would like to purchase a new home.

Their mortgage broker has pre-qualified them for two mortgages: a 30-year fixed at 4 percent or a 5-year ARM at 3 percent. Which of the following factors should be considered in deciding between the two mortgages?

I. Gross income.

II. Estimated length of ownership.

III. Real estate tax liability.

IV. Cash currently available.

A. I, II.

B. II.

C. I, III.

D. Ill, IV.