. A borrower seeking to buy a $800,000 property with a 80% LTV ratio is considering...
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. A borrower seeking to buy a $800,000 property with a 80% LTV ratio is considering two mortgage choices: a FRM or a FRM with an IO period. The lender offers the following two loans: . Loan 1 30 year FRM, fully amortizing monthly payments; 5% interest Loan 2: 30 year FRM with 4 year 10 period, fully amortizing monthly payments; 5.25% interest How do these two loans compare on 1) monthly payments 2) total interest due over life of the loan? If you were deciding between these two loans, which would you pick and why? (2-3 sentences max) . A borrower seeking to buy a $800,000 property with a 80% LTV ratio is considering two mortgage choices: a FRM or a FRM with an IO period. The lender offers the following two loans: . Loan 1 30 year FRM, fully amortizing monthly payments; 5% interest Loan 2: 30 year FRM with 4 year 10 period, fully amortizing monthly payments; 5.25% interest How do these two loans compare on 1) monthly payments 2) total interest due over life of the loan? If you were deciding between these two loans, which would you pick and why? (2-3 sentences max)
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Answer rating: 100% (QA)
To compare the two loans lets calculate the monthly payments and total interest due over the life of each loan Loan 1 Loan amount 800000 80 of the pro... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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