Suppose You Have a 30-Year ARM with a Balance at the EOY2

question 35

Multiple Choice

Suppose you have a 30-year ARM with a balance at the EOY2 of $139,632 and a monthly payment for year 3 of $1239.88.If the margin is 2.50,what is the value of the index to produce this payment?

• A) 10.00%
• B) 7.50%
• C) 12.50%
• D) 7.64%
• E) cannot be determined

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