P
OCKET
R
EFERENCE
G
UIDE
— 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)
3405PRG-E-B 1/9/04 8:45 AM Page 22
