POCKET REFERENCE GUIDE — 22
ARM Payment —
Increasing and
Decreasing Payments
• Loan: $225,000
• Term: 30 years
• Start interest: 4.25%
• 1st ARM interest adjustment:
increases 1% after 6 months
• 2nd ARM adjustment: decreases 1.5%
at end of 1st year
• 3rd ARM adjustment: increases 1.25%
at end of 2nd year and continues to
increase each year thereafter
• ARM Cap: 4%
Find ARM payments through year six:
STEPS KEYSTROKES DISPLAY
Clear o o 0.00
Enter loan 2 2 5 ) l
225,000.00
Enter term 3 0 T 30.00
Enter interest 4 • 2 5 ˆ 4.25
Find initial monthly P&I
payment p “run” 1,106.86
Enter interest
cap 4 s % CAP 4.00
Enter 1st ARM
parameters 1 : • 5 A 1.00 - 0.50
(Cont’d)
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