Question: [2 points] Since interest rates have dropped, you consider refinancing your mortgage at a lower 3% rate. If you took out a new 30 year

  1. [2 points] Since interest rates have dropped, you consider refinancing your mortgage at a lower 3% rate. If you took out a new 30 year mortgage at3% for your remaining loan balance, what would your new monthly payments be?
  2. [2 points] How much interest will you pay over the life of the new loan?
  3. [2 points] Notice that if you refinance, you are going to be making payments on your home for another 30 years. In addition to the 15 years youve already been paying, thats 45 years total. How much will you save each month because of the lower monthly payment?
  4. [2 points] How much total interest will you be paying (consider the interest you paid over the first 15 years of your original loan as well as interest on your refinanced loan)?
  5. [1 point] Now the non-computational question: Does it make sense to refinance? (There isnt a correct answer to this question. Just give your opinion and your reason.)

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