Question: please make the answer clear ty You are buying a house and will borrow $175,000 on a 25 -year fixed rate mortgage with monthly payments

please make the answer clear ty
please make the answer clear ty You are buying a house and

You are buying a house and will borrow $175,000 on a 25 -year fixed rate mortgage with monthly payments to finance the purchase. Your loan officer has offered you a mortgage with an APR of 4.10 percent. Alternatively, she tells you that you can "buy down" the interest rate to 3.80 percent if you pay points up front on the loan. A point on a loan is 1 percent (one percentage point) of the loan value. As you are evaulating the mortgage, you also realize that you believe that you will only live in the house for 7 years before selling the house and buying another house. This means that in 7 years, you will pay off the remaining balance of the original mortgage. What is the maximum number of points that you would be willing to pay? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.164.)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!