Question: Consider a 6%, 30 year, $200,000 level payment mortgage with a monthly payment of $1,199.10. Assume up front financing cost (includes all costs paid to

  1. Consider a 6%, 30 year, $200,000 level payment mortgage with a monthly payment of $1,199.10. Assume up front financing cost (includes all costs paid to the lender and third parties except discount points) equal $3,000.
    1. Find the EBC if the borrower repays the loan after two years (assuming no direct points).
    2. What is the EBC if the lender charges one discount point?
    3. What is the EBC if the lender charges 2.5 discount point?

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