A bank advertises a 6/4 ARM at 4.85% with a 6/13 cap. What is the maximum interest rate that can be charged during the seventh year?

Question

amistre64 · Answer

what does the notation tell us about the terms of the loan?

anonymous · Answer

wait what?

anonymous · Answer

@amistre64

anonymous · Answer

Chen obtains a 15/6 balloon mortgage to finance $462,850 at 4.1%. What is the remaining balance when the balloon payment is due?  PLEASE HELP ME PLEASE!


$248,176.08 

 $203,704.56 

 $361,186.93 

 $310,865.01

amistre64 · Answer

determine the payment for a 15 year fixed loan,  and balance it out after 6 years ....

amistre64 · Answer

the terms of your original question are stated as:

6/4 ARM at 4.85% with a 6/13 cap

the intent of the question is to get you to apply the definition of this notation to an actual problem.  What is your understanding on how to read the notation?  What does your material define it to be?