Question

Wendy is purchasing a condominium and is financing $595,000 with a 20-year 6/1 ARM at 5.65% with a 1/8 cap structure. What will her

payments be at the beginning of year 7? (3 points)


A.$4400.65

B.$4143.50

C.$3623.48

D.$3344.70

Answer 1

B. $4143.50

Explanation:

Wendy has purchased condominium and is financing it through the loan. The loan term is for 8 years with an interest rate of 5.65%. The payment at the start of the year 1 is $595,000 * 5.65% = $3344.70. The loan term reached maturity so the payment will increase to 4143.50