In a 5/1 hybrid adjustable-rate mortgage (ARM), the initial interest rate is fixed for 5 years, then is adjusted annually. (You usually pay points up front at closing in exchange for the rate lock for the first 5 years.) Suppose that you buy a house with a $ 220000, 30 year mortgage with a 5/1 ARM with initial rate of 5.25%; and suppose that five years later, the interest rate goes up to 9.95%. Use the Bankrate amortization schedule online to determine what your monthly payment was, originally, at 5.25%? Monthly Payment = What is your new payment? (Careful: the amount of the loan is no longer $ 220000 and you only have 25 years to pay it off.) New Monthly Payment =
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
In a 5/1 hybrid adjustable-rate mortgage (ARM), the initial interest rate is fixed for 5 years, then is adjusted annually. (You usually pay points up front at closing in exchange for the rate lock for the first 5 years.) Suppose that you buy a house with a $ 220000, 30 year mortgage with a 5/1 ARM with initial rate of 5.25%; and suppose that five years later, the interest rate goes up to 9.95%.
Use the Bankrate amortization schedule online to determine what your monthly payment was, originally, at 5.25%?
Monthly Payment =
What is your new payment? (Careful: the amount of the loan is no longer $ 220000 and you only have 25 years to pay it off.)
New Monthly Payment =
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