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#2269566 - 04/22/22 08:37 PM ARM Amortization Schedule
Wonderofitall Offline
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Wonderofitall
Joined: Sep 2010
Posts: 176
Out West
Doing our first secondary market ARM. The loan has a fixed rate for the first 10 years, the start rate is greater than the index + margin, and the floor is the margin.

Should the am schedule reflect 120 payments of X (fixed rate) and 240 payments of Y (index + margin)? LOS is giving us something different than this.
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#2269570 - 04/22/22 10:55 PM Re: ARM Amortization Schedule Wonderofitall
rlcarey Online
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rlcarey
Joined: Jul 2001
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Galveston, TX
That sounds correct me - what is the LOS showing?
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#2269571 - 04/22/22 11:42 PM Re: ARM Amortization Schedule Wonderofitall
Rocky P Offline
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Posts: 7,423
Florida
Only case where it might be different is if the bank has small caps for the first change period. If the rate is (for example) 4.5%, margin of 2.5% but annual change caps of 1%, it will go from 4.5% to 3.5% at the first change to 2.5% thereafter.
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#2269589 - 04/25/22 03:10 PM Re: ARM Amortization Schedule Wonderofitall
Wonderofitall Offline
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Wonderofitall
Joined: Sep 2010
Posts: 176
Out West
No caps to limit rate change. Start Rate is 3.375%, Index is .288, Margin is 3, but LOS is using 3.5% as the rate for the term remaining after fixed rate ends. Remaining term should be 3.288% shouldn't it?
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#2269615 - 04/25/22 10:52 PM Re: ARM Amortization Schedule Wonderofitall
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 79,633
Galveston, TX
Is it set to round up to the nearest .125%?
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