Question: Given the following information, calculate the effective borrowing cost (rounded to the nearest tenth of a percent). Loan amount: $230,000 Term: 30 years Interest rate:

Given the following information, calculate the effective borrowing cost (rounded to the nearest tenth of a percent).

Loan amount: $230,000

Term: 30 years

Interest rate: 6.75%

Monthly Payment: $1,491.78

Discount points: 1

Origination fee : 2%

Other Closing Expenses: $3,611

Assume the loan is held until the end of year 4

6.80%

8.40%

8.10%

7.60%

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