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19 November, 16:19

You have taken out a $350,000, 3/1 ARM. The initial rate of 6.0% (annual) is locked in for 3 years. Calculate the outstanding balance on the loan after 3 years. The interest rate after the initial lock period is 6.5%. (Note: the term on this 3/1 ARM is 30 years)

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  1. 19 November, 16:21
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    The Monthly Payment = Loan Amount / PVAF (360,0.50%)

    The Monthly Payment = 350000 / 166.7916

    The Monthly Payment = $2098.43

    Loan Balance after 3 years = PV (0.50%,324,-2098.43) = $336294.2
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Home » Business » You have taken out a $350,000, 3/1 ARM. The initial rate of 6.0% (annual) is locked in for 3 years. Calculate the outstanding balance on the loan after 3 years. The interest rate after the initial lock period is 6.5%.
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