Question: A borrower takes out a 2 3 - year adjustable rate mortgage loan for $ 4 9 0 3 5 2 with monthly payments. The

A borrower takes out a 23-year adjustable rate mortgage loan for $490352 with monthly payments. The first two years of the loan have a "teaser" rate of 4%; after that, the rate can reset with a 2% annual rate cap. On the reset date, the composite rate is 5%. What would the Year 3 monthly payment be?

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