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ADJUST'ABL.~ RA'I'~.1~IDEft ~
23376443
INTEREST RATE LIMITS
CONVEBSION OPTIONS
THlti ADJUSTqBLE RA'I'E RIDER is made this 16TH d$y ef Jdnuary 1990
and is incorporated into and shall be deemed to amend and supplement the Mortgage, Deed of'IYust, or Security
Deed, (the "Security Instrument") of the same date given by the undersigned (the "Borrower") to secure
Borrower's Ac~justable Rate Note (the `Note") to HARBOR FEDERAI. SAVINGS AND LOAN ASSOCIATION (the ,
"Lender") of the same date and covering the property described in the Security Instru:nent and located at: ;
1253 SW CEDAR COVE, PORT ST LUCIB, FL. 34986 ~
( Yroperty Address ) ±
!
The Note contai~s provistons alfowing tor changes in the interest rate. If the ~
interest rate incrsases, the Borrower's monthty psyn~ents will be highe~. If the i
interest rate decreases, the Borrower's monthly psyments will be lower. ~
ADDITIONAL COVENANTS. In addition to the covenant and agreements made in the Security ~
Instrument, Borrower and Lender further co~~enant and agree as foUows: ~
A. INTEREST BATE AND MONTHLY PAYMENT CNANGES ~
'I1~e Note provides for an initial interest rate of 9. 500 ~tion 4 of the Note provides for changes ~
in the interest rate and the monthly payments, as follows: '
i
4. INTEREST RATE AND MOhTHLY PAYMENT CHANGES '
(A) Change Dates ~
~
The interest rate 1 will pay may change on the first dayof February ~lg 91 , and on that day
of the month every T~L~B months thereafter. Each date on which my interest rate cauld change is called a
"Change Date". '
(B) 1Le Index ~
Beginning with the first Change Date, my interest rate will be based on an "Index". 'R~e Index is the weekly i
ati~erage yield on United States 'ilreasury securities adjusted to a constant maturity of oNE years, as made
available by the Federal Reserve Board. 'Itie most recent Index figure available as of 45 days before each Ch~nge i
Date is called the "Current Index".
If the tndex is no longer available, the Note Holder wiU choose a new Index which is based upon comparable
information. 'Itie Note Ho[der will giv~e me notice of its choice.
(C) Caicnladon of Changes
Before each Change Date, the Note Holder will calculate my new interest rate by adding TWO AND 750/1000
percentage points ( 2•750 'X,) to the Current Index. The Note Holder wiU then round the re~ult of this '
addition to the neazest one-eighth of one percentage point (0.125~). Subject to the limits stated in Section 4(D)
below, this rounded amount will be my new interest rate until the next Change Date.
'R~e Note Holder will then determine the amount of the montly payment that would be sufficient 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. The resutt of this calculation plus any required monthiy escrow for taxes
and insurance will be the new amount of my monthly payment.
(D) I3mite on Interest Bate Changee
The rate of interest I am required to pay shall never be increased or decreased on any single Change Date by
more than ~W0 percentage points ( 2• from the rate of interest I have
been paying for the preceeding TWELVE months. My interest rate also shaU never increase more
than siX percentage points ( 6.000 ~s,~ from the interest rate
established in paragraph A of this inst rument. ~[y interest rate shall never decrease below the interest rate estab-
lished in paragraph A of this instrument.
(E) EffecHve Date of Changee
My new interest rate will become effective on each Change Date. I will pay the amount of my new monthly
payment beginning on the fust monthly payment date after the Change Date until the amount of my monthly
payment changes again.
(F) Nodce oI Changes
The NoLe 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 fiave regarding the
notice.
(G) Option To Convert AML To F~'ixed Interest Rate
Beginning of the first change date the borrower shal! hati~e the option af converting the Adjustabie
interest rate to a fixed interest rate.l'he fee for exercising the option to convert to a fixed interest rate shall be
two hundred fift,y dollars (S25Q.00). This option shall remain available until:
(1) the borrower exercises the option ar
(2) the expiration of the option on the fifth change date.
The fixed interest rate available to the borrow~r shall be calculated by adding one half of one percentage point
~ 30 ~ to the Federal Home Loan Mortgage Corporation's (FHLMC) Required Net Yieid for 60 day delivery of
yr. fixed rate mortgages and rounding the sum to the next highest one-eighth ofone 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 Lhis Section 4(G) wil! not be geater than the maximum
rate stated in Section 4(D) above. In order to exercise ttie option to ronvert to a fixed interest rate, the borrower
must natify Harbor Federal in writing of his/her intent to exercise the option in accordance with the
2; ~K BOO~S ~ r ~ PAGE~221
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