A borrower takes out a 30-year adjustable rate mortgage loan for $200,000 with monthly payments. The first two years of the loan have a "teaser" rate of 4%, after that. On the reset date, the composite rate is 5%. What would the Year 3 monthly payment be? [Hint: all rates are given you don't really have to calculate contract rates]

A. $1,067

B. $1,071

C. $955

D. $1,186