The monthly payments for the first three-year term of a $250,000 mortgage loan were based on a 25-year amortization period. The interest rate on the mortgage was 3.4% compounded semiannually.

1. What was the size of the monthly payment?

2. What was the principal balance at the end of the three-year term?

3. What would be the size of the monthly payment upon renewal at 3.8 % compounded semiannually now amortized over 22 years?

Answer rating: 100% (QA)

The requirement here is to find the size of the monthly payment and the principle balance at the end of third year for a mortgage loans based on two d... View the full answer