Consider a $5,000,000, 8.5%, 30-year mortgage with monthly payments and a 7-year maturity with balloon. (a) How
Fantastic news! We've Found the answer you've been seeking!
Question:
Consider a $5,000,000, 8.5%, 30-year mortgage with monthly payments and a 7-year maturity with balloon.
(a) How much is this loan worth at issuance if the market YTM for such loans is 8% BEY?
(b) If instead the market yield is 9%, how many disbursement discount points must the lender charge to avoid doing a negative NPV deal?
Related Book For
Finance Applications and Theory
ISBN: 978-0077861681
3rd edition
Authors: Marcia Cornett, Troy Adair
Posted Date: