You just obtained a $325,000 adjustable rate mortgage (ARM) with 30 year amortization and a 3 year reset period. Your starting interest rate for the loan is 3% and you believe that your rate in 3 years will rise to 3.75%. If you are correct, what will be your new mortgage payment at the start of the 4th year (i.e., right after the reset period)?

a. $1,407.96

b. $1,493.53

c. $1,281.75

d. $1,370.21