5/1 ARM reset related Question? - arm reset rates
I have a 5 / 1 ARM E / S loan with a maturity
Loan 5 years ended 2010 and August 2010 septempber'm face the big question: How much would my mortgage. I dug in my loan docs and find this kind of
ARM-term rate based on LIBOR 1 years, with a margin of 2.25%
Cap rate int
the first $ 5% max max adj newspapers thereaftr adj ADJ life than 2% 5%
My current rate is 5.375%. If I will assume that one years immediately after his LIBOR (but calculataion) than what is now 1.53, which means that it is safe to assume that
Their interest rate is 1.53 2.25 = 3.78%
I understand that I have to start repaying the principal amount must be calculated for 25 years and these año.Para come, even when I'm in an int only loan in those years, I have a payment through the main shock for less.
I live in the Bay Area, California, where the value of my house is now 370,000 (or 520,000 at the time of purchase) and the amount of my original loan 416000 (1) and loan.After i 78,000 seconds in 4 years I was in the able to reduce the loan first and second 398,00010-year loan has a fixed up 45000th
My question was related to the first loan will be reset to the next year.Can please let me know if my interest is to add 3.78% or the lender (Wells Fargo), up to 5% is my current interest rate is 5.375 to 10.375%, and add to the list of forclosure ;-)
Please share your experiences.
Thursday, January 7, 2010
Arm Reset Rates 5/1 ARM Reset Related Question?
2 comments:
Your interest rate is 3.78%. The term means that the rate increase of more than 5%, but not yet LIBOR + 2.25%
When it reset in the next month, it should be easier to determine what is probable. So I want my hypothesis about this, what would happen if I reset in the next month.
I doubt that the bank has a loan that is reset every month there have been so difficult to determine how to calculate the base. If you reset one years, then I suspect that with the average of LIBOR plus a year earlier. Libor rate was very high during the crisis, is about 2.50% based on the average use in the previous year by giving your new interest rate of about 4.75%.
It would probably be lower if it is reset every 6 months and probably a floor space of approximately 1.9% (average for the last 6 months) or a new kind of around 4.15%.
However, if your loan will be adjusted monthly, so is the interest rate should be the next 3.85% (first month LIBOR of 1.6%), but then it would probably be adjusted each month for payments to each different month.
http://www.moneycafe.com/library/libor.h ...
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