ADJUSTABLE RATE MORTGAGE DISCLOSURE
This disclosure describes the features of the adjustable-rate mortgage (ARM) program you are considering.
HOW YOUR INTEREST RATE AND PAYMENT ARE DETERMINED
Your interest rate will be based on an index rate plus a margin.
Your payment will be based on the interest rate, loan balance and loan term.
The interest rate will be based on the weekly average yield on the Prime Rate as published in the “Money Rates” column of
the Wall Street Journal plus our margin. The margin is based on the repayment period. Ask for our current interest rate and
margins. The initial rate is based on the index and margin used for subsequent rate adjustments.
HOW YOUR INTEREST RATE CAN CHANGE
Your interest rate can change on the 31st day of January and July. Over the term of the loan your interest rate will never be
greater than 13%, but there is no other limit on the amount of interest rate changes. In determining the rate change, the rate
will be rounded to the next highest 0.25%.
HOW YOUR PAYMENT CAN CHANGE
Your monthly payment can change semi-annually. Payments may increase or decrease substantially based on changes in the
interest rate.
5 Year Loan
For example, on a $10,000.00, 5 year loan with an initial rate of 2.74% in effect March 2013, the maximum amount that the
interest rate can rise under this program is 10.26 point(s) to 13.0%, and the monthly payment can rise from a first year
payment of $178.54 to a maximum of $226.69 in the 1st year.
To see what your payments would be, divide your mortgage amount by $10,000.00; then multiply the monthly payment by
that amount. (For example, the monthly payment for a mortgage amount of $60,000.00 would be: 60,000.00/10,000.00 = 6; 6
x 178.54 = $1,071.24 per month.)
15 Year Loan
For example, on a $10,000.00, 15 year loan with an initial rate of 3.25% in effect March 2013, the maximum amount that the
interest rate can rise under this program is 9.75 point(s) to 13.0%, and the monthly payment can rise from a first year
payment of $70.27 to a maximum of $126.21 in the 1st year.
To see what your payments would be, divide your mortgage amount by $10,000.00; then multiply the monthly payment by
that amount. (For example, the monthly payment for a mortgage amount of $60,000.00 would be: 60,000.00/10,000.00 = 6; 6
x 70.27 = $421.62 per month.)
Notice Process
You will be notified in writing at least 60, but not more than 120 calendar days before the due date of a payment at the new
level. This notice will contain information about your interest rates, payment amount and loan balance.
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SPECIAL ARM003 303336 (C303336ARM) 01/07/2014