Form 38.18 - Promissory Note And Mortgage; Escrow Agreement
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3FORM 3B.18
REAL ESTATE LOANS
SECTION III
PROMISSORY NOTE AND MORTGAGE; ESCROW AGREEMENT
_______________________________________________________________________________
FORM 3B.18
MULTISTATE ADJUSTABLE RATE NOTE—COST OF FUNDS INDEX—PAYMENT AND RATE CAPS
(FHLMC)
ADJUSTABLE RATE NOTE
(11th District Cost of Funds Index - Rate Caps)
THIS NOTE CONTAINS PROVISIONS ALLOWING FOR CHANGES IN MY INTEREST
RATE AND MY MONTHLY PAYMENT. THIS NOTE LIMITS THE AMOUNT MY
INTEREST RATE CAN CHANGE AT ANY ONE TIME AND THE MAXIMUM RATE I MUST
PAY.
[Date]
[City]
[State]
[Property Address]
1.
BORROWER’S PROMISE TO PAY
In return for a loan that I have received, I promise to pay U.S. $____________________________ (this amount is
called “Principal”), plus interest, to the order of the Lender. The Lender is ______________________
______________________. I will make all payments under this Note in the form of cash, check or money order.
I understand that the Lender may transfer this Note. The Lender or anyone who takes this Note by transfer and
who is entitled to receive payments under this Note is called the “Note Holder.”
2.
INTEREST
Interest will be charged on unpaid principal until the full amount of Principal has been paid. I will pay interest at a
yearly rate of _______________%. The interest rate I will pay will change in accordance with Section 4 of this Note.
The interest rate required by this Section 2 and Section 4 of this Note is the rate I will pay both before and after
any default described in Section 7(B) of this Note.
3.
PAYMENTS
(A)
Time and Place of Payments
I will pay principal and interest by making a payment every month.
I will make my monthly payment on the first day of each month beginning on _____________________,
__________. I will make these payments every month until I have paid all of the principal and interest and any other charges
described below that I may owe under this Note. Each monthly payment will be applied as of its scheduled due date and will
be applied to interest before Principal. If, on ______________________________, 20________, I still owe amounts under
this Note, I will pay those amounts in full on that date, which is called the “Maturity Date.”
I will make my monthly payments at _______________________________________________________
________________________________________________ or at a different place if required by the Note Holder.
(B)
Amount of My Initial Monthly Payments
Each of my initial monthly payments will be in the amount of U.S. $________________________. This amount
may change.
(C)
Monthly Payment Changes
Changes in my monthly payment will reflect changes in the unpaid principal of my loan and in the interest rate
that I must pay. The Note Holder will determine my new interest rate and the changed amount of my monthly payment in
accordance with Section 4 of this Note.
4.
INTEREST RATE AND MONTHLY PAYMENT CHANGES
(A)
Change Dates
The interest rate I will pay may change on the first day of ________________________________, ___________,
and on that day every _________________________ month thereafter. Each date on which my interest rate could change is
called a “Change Date.”
(B)
The Index
Beginning with the first Change Date, my interest rate will be based on an Index. The “Index” is the monthly
weighted average cost of savings, borrowings and advances of members of the Federal Home Loan Bank of San Francisco
(the “Bank”), as made available by the Bank. The most recent Index figure available as of the date 45 days before each
Change Date is called the “Current Index.”
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