I have a 7 year ARM that is due to reset in August 2010. My current interest rate is 4.875%. My ARM margin is 2.75%. My ARM index rate is 1.02%. My ARM index is based upon the Weekly AVG of the 1 Yr US Treasury. If my ARM would reset today, what would my new rate be (assuming I don't have a floor on the rate)? I was thinking 2.75 0.35 = 3.1, but I'm not sure if that is correct.

The formula to calcualte your rate should be (refer to your origanal papaerwork to verify) the INDEX + the MARGIN = RATE. So if as you stated above the index was equal to 1.02 and the margin is 2.75, your rate would adjust to 3.76 (1.02 + 2.75). The caps and floors would have to also be considered, but the most common treasury ARMs ussually had the floor = the margin, so you probably would not be affected at this time.I hope this helps!James Mucci<A href="http://michiganmortgageadvisor.com/michigan-refinancing-stages-of-the-loan-process/">Michigan Refinancing</A> Specialist