You have decided to buy a 3,250 square-feet house in Denton, close to a good public school. The average price in the area is $190 per square feet. The bank will finance 80% of the house value, so you...

You have decided to buy a 3,250 square-feet house in Denton, close to a good public school.  The average price in the area is $190 per square feet.  The bank will finance 80% of the house value, so you need savings for the 20% down payment.

You sign a 30-year 5/1 adjustable rate mortgage (ARM), which carries a 3.2% fixed rate for the first 5 years, and then (after 5 years) is adjusted to the 1-year LIBOR + 1.25 %.

Compute your monthly payments in 5 years (month 61) if the LIBOR is 3%