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Assume a borrower gets a 1-year ARM (meaning it has a yearly adjustment period) for $100,000 for 30 years. It has a 5/2/6 interest rate
Assume a borrower gets a 1-year ARM (meaning it has a yearly adjustment period) for $100,000 for 30 years. It has a 5/2/6 interest rate cap. The current index rate is 4.5%, the margin is 3%, and the discounted start rate is 4%. What would be the interest rate in Year 5
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