We discussed price level adjusted mortgages in class; saying they are useful to understanding adjustable-rate mortgages. However, there are several disadvantage to them, which is why they are seldom used. Of the following, which would you consider to be a disadvantage of a PLAM (price level adjusted mortgage)?

		The price level used to index PLAMs is measured on an ex post basis and historic prices may not be an accurate reflection of future price.
		All of the choices are disadvantages.
		Fewer homebuyers are likely to qualify for financing using PLAMs in comparison to CPMs.
		Lenders face high levels of interest rate risk under PLAMs.