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- The new rate does not break the Rate Reset Change Cap/Floor rule. For example, if Current Rate is 4% and Rate Reset Change Cap is 1, a New Rate of 5.25% is not allowed, and instead the New Rate is 5%. Similarly, if Current Rate is 4%, Rate Reset Change Floor is 1.2 and New Rate from variable rate table is 2.5%, New Reset Rate is set at 2.8% (4 minus 1.2).
- The new rate does not go above or below the Rate Reset Cap or Floor. For example, if the Rate Reset Cap is 6% and the rate available from the Variable Rate Table is 6.2%, the New Rate is set at 6%.
- Both of the above tests must pass. For example, Current Rate is 5, Rate Reset Change Cap value is 1, and Rate Reset Cap value is 5.5; If the New Rate in variable rate table is 5.75, the rate in the Reset Array is set to 5.5.
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