Question: An adjustable rate mortgage has a yearly interest rate adjustment

An adjustable rate mortgage has a yearly interest rate adjustment cap of 1 percent. If the indexed rate moves up by 11⁄2 percent in the first year and 1⁄2 percent in the second year, how much can the interest rate on the remaining loan balance move up after the first year, and after the second year?

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  • CreatedMarch 19, 2015
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