hybrid loans

A 3/1 hybrid mortgage loan is granted in the amount of $100,000 with a maturity of 30 years and an interest rate of 7%, which is the prevailing market rate. At the end of three years, the market interest rate was found to have increased to 8.5%. The loan is fully amortized.

a. Calculate the amount of the monthly payment for the first three years of the mortgage. 5 points b. Calculate the monthly payment amount for the fourth year. 5 points