How are adjustable loan rates calculated?
The interest rate of each mortgage is determined by adding the margin to the index rate for the loan you prefer. Six-Month Adjustable The rate for this loan is adjusted every six months, using the six-month LIBOR and a margin of 2.75%. At the six-month adjustment date, the rate may increase or decrease, but will never change more than 1% (100 basis points). One-Year Adjustable The rate for this loan is adjusted every twelve months, using the weekly average yield of one-year US Treasury Securities and a margin of 3.00%. At the annual adjustment date, the rate may increase or decrease, but will never change more than 2% (200 basis points). Three-Year Adjustable The rate for this loan is adjusted every three years, using the weekly average yield of three-year US Treasury Securities and a margin of 3.25%. At the adjustment date, the rate may increase or decrease, but will never change more than 2% (200 basis points).
