Question: 2) Ann is looking for a fully amortizing 30-year Fixed Rate Mortgage with monthly payments for $1,250,000. Mortgage A has a 4.38% interest rate and

2) Ann is looking for a fully amortizing 30-year Fixed Rate Mortgage with monthly payments for $1,250,000. Mortgage A has a 4.38% interest rate and requires Ann to pay 1.5 points upfront. Assuming Ann makes payments for 2 years, then immediately pays the remaining balance, what is Anns IRR from mortgage A?

3) Ann is looking for a fully amortizing 30-year Fixed Rate Mortgage with monthly payments for $1,250,000. Mortgage A has a 4.38% interest rate and requires Ann to pay 1.5 points upfront. Mortgage B does not require to pay any fees upfront. Assuming Ann plans to make payments for 2 years and then immediately pay the remaining balance, what should be the interest rate on mortgage B to make Ann indifferent between these two mortgages?

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