ARM Payment — Worst-Case Scenario
Find the initial monthly payment on a 30
year, $176,000 mortgage at 8.25% annual
interest rate. Find the second and third
years’ “worst-case” adjusted payments if
this ARM loan increases 1% at the end of
each year. Find the remaining loan bal-
ance, term, and interest rate.
Steps/Keystrokes
Display
1. Clear calculator:
[On/C] [On/C]
0.00
2. Enter loan amount, term and annual
interest:
176,000 [L/A]
176,000.00
30 [Term]
30.00
8.25 [Int]
8.25
3. Find initial monthly payment:
[Pmt]
“run”
1,322.23
4. Enter ARM parameters and find 1st and
2nd “adjusted” payments:
1 [:] 1 [ARM]
1.00 – 1.00
[ARM]
“run”
1,445.79
[ARM]
“run”
1,570.86
5. Find principle at start of year:
[Rcl] [L/A]
173,350.16
6. Recall current interest rate, then recall
remaining term:
[Rcl] [Int]
10.25
[Rcl] [Term]
28.00
44 — Real Estate Master
®
IIx/Qualifier Plus
®
IIx
