The Following Problem Involves Adjustable-Rate Mortgage

question 153

Multiple Choice

The following problem involves adjustable-rate mortgage. You will need a table of monthly payments.
-Suppose your mortgage is $55,400 for 25 years. The index rate is 7.5% and the margin is 2.5%. After three years, the Treasury index decreases to 6.5%. Using the adjusted balance of $53,896.88, find the
New monthly payment.

• A)$415.50
• B)$503.42
• C)$469.54
• D)None of the above is correct.

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