5/1 ARM adjustment question - Loan Modification Forum

NoSleep · 10-15-2009, 10:16 AM

I need to find my contract and read it over for all the details. I noticed the Libor rate which my loan is based on is about half of what it was when I got my loan. It's a 5/1 ARM with citi obtained in december 2004.

Assuming the Libor stay about the same, will my rate go lower when it adjust in december. There is a cap of 1/2% change every 6 months if I remember correctly.

Thanks

NoSleep · 10-15-2009, 01:27 PM

Found my paperwork and detail as follows.

5/1 ARM rate is based on 1 year LIBOR rate + 2.25% margin.

Min interest rate is 2.25% and max interest rate is 9.875%

Adjust every 12 months (well that's the 1 in the 5/1), max increase and decrease every 12 months is capped at 2%.

When I got my loan Libor was 2.8% and it looks like current libor rate is hanging around 1.2-1.3%.

It looks like with the 1.5% interest rate drop my payment will be $244 less. Although I do not quality for loan modification, I guess this outlook is good for next year at least.

10-15-2009, 10:16 AM	#1 (permalink)
NoSleep Member Join Date: May 2009 Posts: 6 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	5/1 ARM adjustment question I need to find my contract and read it over for all the details. I noticed the Libor rate which my loan is based on is about half of what it was when I got my loan. It's a 5/1 ARM with citi obtained in december 2004. Assuming the Libor stay about the same, will my rate go lower when it adjust in december. There is a cap of 1/2% change every 6 months if I remember correctly. Thanks

10-15-2009, 01:27 PM	#2 (permalink)
NoSleep Member Join Date: May 2009 Posts: 6 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: 5/1 ARM adjustment question Found my paperwork and detail as follows. 5/1 ARM rate is based on 1 year LIBOR rate + 2.25% margin. Min interest rate is 2.25% and max interest rate is 9.875% Adjust every 12 months (well that's the 1 in the 5/1), max increase and decrease every 12 months is capped at 2%. When I got my loan Libor was 2.8% and it looks like current libor rate is hanging around 1.2-1.3%. It looks like with the 1.5% interest rate drop my payment will be $244 less. Although I do not quality for loan modification, I guess this outlook is good for next year at least.

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