Anisha received a 10-year mortgage of $600,000 to purchase a condominium. They negotiated a fixed interest rate
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Anisha received a 10-year mortgage of $600,000 to purchase a condominium. They negotiated a fixed interest rate of 5% compounded semi-annually for a 6-year term. Their mortgage contract also stated that they could prepay 8% of the original principal every year without an interest penalty. By how much did their amortization period shorten if:
i) They made a prepayment of $60,000 at the end of the 2nd year?
ii) They increase the periodic payment by 30% starting from the 3th payment?
Related Book For
Survey of Accounting
ISBN: 978-0078110856
3rd Edition
Authors: Thomas P. Edmonds, Frances M. McNair, Philip R. Olds, Bor-Yi
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