Currently, fixed mortgage rates are 8% for a 30-year mortgage. You checked and found a 3/1 adjustable-rate mortgage with a 30 year amortization of 6.0%. The terms of the adjustable-rate mortgage are: Index Rate: 5% Margin: 2% Annual cap 1% After three years, the index rate is now 3%, what is your new mortgage rate? O A. 5% O B. 6% C.7% D.8%
Currently, fixed mortgage rates are 8% for a 30-year mortgage. You checked and found a 3/1 adjustable-rate mortgage with a 30 year amortization of 6.0%. The terms of the adjustable-rate mortgage are: Index Rate: 5% Margin: 2% Annual cap 1% After three years, the index rate is now 3%, what is your new mortgage rate? O A. 5% O B. 6% C.7% D.8%
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter5: Making Automobile And Housing Decisions
Section: Chapter Questions
Problem 7FPE
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![QUESTION 2
Currently, fixed mortgage rates are 8% for a 30-year mortgage. You checked and found a 3/1 adjustable-rate mortgage with a 30 year
amortization of 6.0%. The terms of the adjustable-rate mortgage are:
Index Rate:
5%
Margin:
2%
Annual cap
1%
After three years, the index rate is now 3%, what is your new mortgage rate?
А. 5%
В.6%
C.7%
D. 8%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F51429d23-75ef-4400-b399-dac785222d20%2F3ad31581-c23a-4034-a57e-25352e001568%2Ftxi4rkr_processed.png&w=3840&q=75)
Transcribed Image Text:QUESTION 2
Currently, fixed mortgage rates are 8% for a 30-year mortgage. You checked and found a 3/1 adjustable-rate mortgage with a 30 year
amortization of 6.0%. The terms of the adjustable-rate mortgage are:
Index Rate:
5%
Margin:
2%
Annual cap
1%
After three years, the index rate is now 3%, what is your new mortgage rate?
А. 5%
В.6%
C.7%
D. 8%
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