An ARM is made for $150,000 for 30 years with the following terms:

initial interest rate = 7 percent

index = 1-year treasuries

payments reset each year

margin = 2 percent

interest rate cap = none

payment cap = 5 percent increase in any year

discount points = 2 percent

Fully amortizing; however, negative amotrization allowed if payment cap reached.

(BOY) 2 = 7 percent ; (BOY) 3 = 8.5 percent ; (BOY) 4 = 9.5 percent ; (BOY) 5 = 11 percent

Compute the payments, loan balances, and yield for the ARM for the five-year period.