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ADJUSTA?BI.E RATE R.IDER '
. 23375148
~ . . . ~ .
INTEREST BATE LIMITS
CONVEBSION OPTIONS
THI~ ADJttSTABLE RATE RIDER is made this 23~ day of January 1990
and is incorporated into and shaU be deemed to amend and suppleme~t the hiortgage, Deed of'IYust, or Security
Deed, (the "Security lnstrument') of the same date giv~en by the undersigned (the "Borrower") to secure
Borrower's Ac~justable Rate Note•(the "Note") to HARBOR FEDERALSAVINGSAND LOAN ASSOCIATION (the
"Lender") of the same date and co~~ering the property described in the Security Instrument and located at: "
CHESTNUT LANE, PORT ST. LUCIB~ FL 34953
( F'roperty Address )
The Note contai~s provisions allowing for changes in the inte~est rate. If the
interest rate increases, the Bor~owe~'s monthly payme~ts will be highe~. If the
interest rate decreases, the Borrower's monthly payments will be lower.
ADDITIONAL COVENANTS. In addition to the cov~nant and agreements made in the Security
Instrument, Borrower and Lender turther cov~enant and agree as follows:
A. INTEREST RATE AND MONTHLY PAYMENT CHANGES
'ITie Note provides for an initial interest rate of 8.125 Section 4 of the Note pro~ldes for changes
in the interest rate and the monthly payments, as follows:
4. INTERFST RATE AND MONTHLY PAYMENI' CHANGFS
(A) Change Dates
'Rie interest rate I will pay may change on the first day of February ,19 91 , and on that day '
of the month every TWELVB months thereafter. Each date on which my interest rate could change is called a
"Change Date".
(B)1Le Index
Beginning wlth the first Change Date, my interest rate will be based on an "Index". The Index is the weekly
average yield on United States 'Ilreasury securities adjusted to a constant maturity of oHE y~ears, as made
available by the F'ederal Reset-v~e Board. 'R~e most recent Index figure available as of 45 days before each Change
Date is called the "Current Index".
If the Index is no longer available, the Note Holder will choose a new Index which is based upon comparable
information. '1lie Note Holder w~ll gi~~e me notice of its choice.
(C) Calcalalion of G'hanges
Before each Change Date, the Note Holder will calculate my new interest rate by adding TWO AND 750/1000
percentage points ( 2.750 to the Current Index. 1t?e Note Holder will then round the result of this
addition to the nearest one-eighth of one percentage point (0.125%). Subject to the limits stated in Section 4(D)
below, Lhis rounded amount will be my new interest rate unLil the next C;hange Date.
The Note Holder will then determine the amount of the montly payment that would be suflicient to repay the
unpaid principal that I am expected to owe at the Change Date in full on the maturity date at my new interest
rate in substantially equal payments. 'I~e result of this calculation plus any required monthly escrow for taxes
and insurance will be the new amount of my monthly payment.
(D) ~3mits on Interest Bate Changes
The rate of interest I am required to pay shall ne~~er be incre~as~ed or decreased on anysingle Change Date ry
; more than TWO percentage points ( 2.000 from the rate of interest I have
; been paying for the preceeding ~g,~,~g months. Myinterest rate also shall nev~er increase more
than SIX percentage points ( 6.000 `fi) from the interest rate
, established in paragraph A of this instrument. My interest rate shall never decrease below the interest rate estab-
; lished in paragraph A of this instrument.
~ (E) Effecdve Date of Changes
p My new interest rate will become effective on each Change Date. I will pay the atnount of my new monthly
~ payment beginning on the first monthly payment date after the Change Date until the amount of my monthly
payment changes again.
4 (F) Notlce of Changes
~ The Note Holder will mail or deliver to me a notice before each Change Date. The notice will advise me of:
' (i) the new interest rate on my loan ati of the Change Date:
~ (ii) the amount of my monthly payment following the Change Date;
~ (iu) Any additional matters which the Note Holder is required to disclose; and
~ (iv) the title and telephone number of a person who will answer any question I may have regarding the
notice.
(G) Option To Convert AML To F'I~ced Interest Bate
Aeginning of the ferst change date the borrower shall hav~e the option of converting the Adjustable
interest rate to a fixed interest rate. The fee far exercising the option to convert to a fixed interest rate shall be
two hundred Fdty dollars (~250.00). 'Ifiis option shall remain availabte until:
(1) the borrower exercises the option or
(2) the expiration of the option on the fifth change date.
The fixed interest cate available to the bonower shall be calculated by adding one half of one percentage point
~ (.50) to the Federal Home Loan Mortgage Corporation's (F'~iLMC) R2quired Net Yield for 60 day delivery of
~ 30 yr. fixed rate mortgages and rounding the sum to the next highest one-eighth of one percentage point
(.125). The interest rate will be established upon receipt of borrower's written notice of intent to exercise the
~ option to convert. My new interest rate calculated under thi.s Section 4(G) will not be greater than the maximum
~ rate stated in Section 4(D) abov~e. In order to exercise the option to convert to a fixed interest rate, the borrower
~ must notify Harbor Federal in writing of his/her .intent to exercise the option in accordance with the
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R Z;~~ 6~~K 674 PACE1978
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