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 2.00%. The interest rate I will pay may
change in accordance with Section 4 of this note.
The interest rate required by the 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.

4. ADJUSTABLE INTEREST RATE AND MONTHLY PAYMENT CHANGES
(A) Change Dates
The initial fixed interest rate I will pay will change to an adjustable rate on the 1st
day of November, 2008, and the adjustable interest rate I will pay may change on that
day every 12th month thereafter. The date on which my initial fixed interest rate changes
to an adjustable interest rate, and each date on which my adjustable interest rate could
change, is called a “Change Date.”
(B) The Index
Beginning with the first change date, my adjustable interest rate will be based on
an Index. The “Index” is the average of FEDERAL FUNDS RATE offered rates of one-year U.S. dollar denominated “FEDERAL FUNDS RATE”), as published in The Federal Reserve Statistical Release (http://www.federalreserve.gov/releases/h15/Update/) web site . The most recent Index figure available as of the date 45 days before each
Changes Date is called the “Current Index.”
If the index is no longer available, the Note Holder will choose a new index that is
based upon comparable information. The note holder will give me notice of the choice.
(C) Calculation of Changes
Before, each Change Date, the note holder will calculate my new interest rate by
adding TWO FORTH percentage points (0.50%) to the current index. The
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, this
rounded amount will be my new interest rate until the next change date.
The note holder will then determine the amount of my monthly payment. For
payment adjustments occurring before the First Principal and Interest Due Date, the
amount of my monthly payment will be sufficient to repay all accrued interest each
month on the unpaid principal balance at the new interest rate. If I make a voluntary
payment of principal before the First Principal and Interest Payment Due Date, my
payment amount for subsequent payments will be reduced to the amount necessary to
repay all accrued interest on the reduced principal balance at the current interest rate. For
payment adjustments occurring on or after the First Principal and Interest Payment Due
Date, the amount of my monthly payment will be sufficient to repay unpaid principal and
interest that I am expected to owe in full on the maturity date at the current interest rate in
substantially equal payments.
(D) Limits on Interest Rate Changes
The interest rate I am required to pay at the first Change Date will not be greater
that 3.625% or less then 1.250%. Thereafter, my adjustable interest rate will never be
increased or decreased on any single Change Date by more that two percentage points
from the rate on interest I have been paying for the preceding TWELVE months. My
interest rate will never be greater than 3.625%.

Interest only period adjustable rate note

Mortgage interest rate= INDEX+MARGIN

Interest rate cap = index+2.125