Pre-Application 5-1 Year Adjustable Rate Mortgage Loan ...



Pre-Application 7-1 Year Adjustable Rate Mortgage Loan Disclosure Statement (1-Year LIBOR Index 5 Percentage Point Lifetime Cap on Interest Rate Increases Discount)M & T BankThis disclosure describes the features of the Adjustable Rate Mortgage (ARM) program you are considering. Information on other ARM programs is available upon request.How Your Interest Rate and Payment Are DeterminedYour 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.-Except for the initial interest rate, (which will be in effect for 7 years), the interest rate will be based on the average of the interbank offered rates for one year U.S. dollar-denominated deposits in the London market - "LIBOR" (your index), plus our margin, and rounded to the nearest 1/8%. Ask us for our current interest rate and margin.-Information about the index rate is published in The Wall Street Journal.Except for the initial interest rate,(which will be in effect for 7 years), your interest rate will equal the index rate plus our margin, rounded to the nearest 1/8%, unless your interest rate "caps" limit the amount of change in the interest rate.Your initial interest rate is not based on the index used to make later adjustments. Ask us for the amount of the discount applicable to the ARM program you have selected.How Your Interest Rate Can ChangeYour interest rate can change yearly after 7 years.Your interest rate can not increase or decrease more than 5 percentage points at the first interest rate change date.After that your interest rate cannot increase or decrease more than 2 percentage points per year.Your interest rate cannot increase more than 5 percentage points over the term of the loan.How Your Monthly Payment Can ChangeYour monthly payment can increase or decrease substantially based on annual changes in the interest rate.For example, on a $10,000, 30-year loan with an initial interest rate of 3.000% in effect in June 2016, the maximum amount that the interest rate can rise under this program is 5.000 percentage points, to 8.000%, and the monthly payment can rise from a first-year payment of $42.16 to a maximum of $66.64 in the 8th year of the loan. To see what your payment is, divide your mortgage amount by $10,000; then multiply the monthly payment by that amount. (For example, the first-year monthly payment for a mortgage amount of $60,000 would be: $60,000 / $10,000 = 6; 6x $42.16.= $252.96.You will be notified in writing at least 25, but no more than 120 days before the due date of a payment at a new level. This notice will contain information about your interest rates, payment amount, and loan balance.Acknowledgment. By signing below, I acknowledge receipt of a copy of this disclosure statement and the “Consumer Handbook On Adjustable Rate Mortgages” booklet. ____________________________________________ Signature of applicantDate ____________________________________________ Signature of applicantDate ................
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