Early Arm Disclosure

On our early arm disclosures, it uses the "worst case example" to illustrate the payment. In the language it states that "this can rise to a max of $xx in the fourth year." This discosure is for a 7/1 ARM. Is there a problem with that "fourth year" language?

Thank you and hope that made sense.

What is the first adjustment cap, annual cap and maximum cap. Yours appears to be incorrect.

If it is a 7/1 with caps of 5/2/5 (initial/annual/maximum), then the maximum would be in the 8th year because the loan could go up the lifetime cap at the first adjustment.