Question

Stefani is purchasing a house and finances $410,350 of the purchasing price. The mortgage is a 30 year 7/3 ARM at 6.5% with a 4/13 cap structure. What will the remaining balance be after the first seven years? (show work)

A= $371,023.06
B= $217,870.06
C= $357,112.36
D= $192,479.94

Answer 1

I used an online mortgage calculator.

Inputted the following information:
Loan amount: 410,350
loan rate: 6.5%
loan term: 30 years

It gave me the following results:
monthly payment: 2,593.69
annual payment: 31,124.29

31,124.29 * 7 years = 217,870.03 total payment after 7 years.

Based on the Yearly Amortization Table, the remaining balance after the first seven years is $373,327.70

The figure is nearest to Choice A. 371, 023.06