Assume that you have purchased a home and can qualify for a $200,000 loan. You have narrowed

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Assume that you have purchased a home and can qualify for a $200,000 loan. You have narrowed your mortgage search to the following two options:

Mortgage A

Loan term: 30 years

Annual interest rate: 6 percent

Monthly payments

Up-front financing costs: $5,000

Discount points: 3

Mortgage B

Loan term: 15-years

Annual interest rate: 5.5 percent

Monthly payments

Up-front financing costs: $7,000

Discount points: 3

Based on the effective borrowing cost, which loan would you choose?

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Real Estate Principles A Value Approach

ISBN: 978-0077836368

5th edition

Authors: David C Ling, Wayne Archer

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Question Posted: May 27, 2018 07:23 AM

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Assume that you have purchased a home and can qualify for a $200,000 loan. You have narrowed

Question:

Step by Step Answer:

Mortgage A payment 119910 Mortgage A effective borrowing cost 654 PV 2000...View the full answer

Real Estate Principles A Value Approach

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