For this question I need to compare 2 mortgage options. The amount and the duration of the mortgage are the same for both possibilities - $500,000 amortized over 25 years.

Option 1 is a 5 year fixed rate mortgage. Payments will be made monthly and the annual interest rate is prime +1%.

Option 2 is a 10 year fixed rate mortgage. Payments will be made bi-weekly and the annual interest rate is prime +2%.

Prime rate is currently 1.5%, and its expected to increase by .25% per year for the next 10 years.

Which mortgage option should they choose if the goal is to pay down as much as possible in the next 10 years?

*please show formulas used. Thank you!