(3) The monthly payment on a 30-year level payment mortgage assuming an annual mortgage rate of 5% and an initial mortgage principal of $400,000 is $2,147.29.

Consider a $400 million pass-through MBS that has just been created (so the 'seasoning' of the pass-through is equal to 0). The underlying pool of mortgages each has a maturity of 20 years and an annual mortgage coupon rate of 6%. The pass-through rate of the mortgage pool is 5%. Assuming a prepayment multiplier of 100 PSA what is the total amount of interest paid to the pass-through investors?