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LOAN 1 LOAN 2 LOAN 3 LOAN 4 Initial Interest Rate ? ? ? ? Loan Maturity (years) 20 20 20 20 % Margin Above

LOAN 1 LOAN 2 LOAN 3 LOAN 4
Initial Interest Rate ? ? ? ?
Loan Maturity (years) 20 20 20 20
% Margin Above Index 3% 3% 3%
Adjustment Interval 1 year 1 year 1 year
Points 1% 1% 1% 1%
Interest Rate Cap NONE 1%/year 3%/year

With which loan in the above table does the lender have the lowest interest rate risk?

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