Question: Question 3 : Assume an ARM for $ 1 0 0 , 0 0 0 with an initial interest rate of 6 % with a

Question 3: Assume an ARM for $100,000 with an initial interest rate of 6% with a term of 30 years with payments being reset at the end of each year based on an index. The ARM is subject to a payment cap of 10%. If the market index were to rise at the end of the first year and it changes the interest rate on the ARM to 8%, what would be the new monthly payment amount?
Question 3: Assume an ARM for $100,000 with an initial interest

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