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What is the payment on the following ARM in the third year? Loan: $500,000; Margin 2%; Amortization term: 25years; Teaser rate: 2.5% for first year;
What is the payment on the following ARM in the third year? Loan: $500,000; Margin 2%; Amortization term: 25years; Teaser rate: 2.5% for first year; periodic cap = 1% which also applies to the teaser rate. The underlying index at each date t=0, 1yr, 2yr, and 3-30yr is: 1%, 2%, 2.5% and 3%, respectively. Do not round intermediate results. Enter your answer to the nearest whole dollar and leave out the "$" sign and any ",". For example, if your answer is $3,124.56, enter 3125 (no "$", no ",")
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