Question
You have taken out a $250,000, 5/1 ARM. The initial rate of 5.4% (annual) is locked in for 5 years. Calculate the payment after recasting
You have taken out a $250,000, 5/1 ARM. The initial rate of 5.4% (annual) is locked in for 5 years. Calculate the payment after recasting the loan (i.e., after the reset) assuming the interest rate after the initial lock period is 8.0%. (Note: the term on this 5/1 ARM is 30 years) Show your steps used in Excel.
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The Economics Of Money Banking And Financial Markets
Authors: Frederic S. Mishkin
9th Edition
0321598903, 978-0321598905
