Question: Assume a 1/1 ARM without cap. Term=15 years. Initial loan balance=$10,000. The starting teaser rate=3%, margin=2%. Year LIBOR 1 6.60% 2 13.50% What is the

Assume a 1/1 ARM without cap. Term=15 years. Initial loan balance=$10,000. The starting teaser rate=3%, margin=2%.

Year LIBOR
1 6.60%
2 13.50%

What is the total interest payment in Year 2?

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