12. The initial monthly payment on an adjustable rate mortgage with a balance of $100,000, an interest rate of 8.5% annually and a term of 30 years will be:

a. $3,711.78

b. $733.76

c. $768.91

d. $3,688.83

13. The longer the adjustment period on an ARM:

a. The lower the value of the ARM to the lender

b. The higher the value of the ARM to the lender

c. Has no effect on the value of the ARM

d. The higher the risk to the borrower

14. The following is not an alternative mortgage instrument:

a. SAM

b. RAM

c. HFR

d. FLIP

15. The following is NOT true of a Shared Appreciation Mortgage:

a. There are annual adjustments to the contract rate

b. There is the risk that property values may not increase as fast as general inflation

c. The borrower may not have an incentive to maintain the property

d. The contract rate is generally lower than on a standard fixed rate loan