Question 2 (1 point)

What is the difference in total payments for a loan of $35,000 which is paid over 5 years with equal total payments, compared to a loan of $35,000 which is paid back in equal total payments starting in year 3 with interest only payments in years 1 and 2? Loan is at 5.5% interest.

The amortization tables below are provided for your use.

Option 1: Equal Total Payment Option

Year	Total payment	Interest paid	Principal paid	Principal remaining
1
2
3
4
5
TOTAL

Option 2: Interest Only Option

Year	Total payment	Interest paid	Principal paid	Principal remaining
1
2
3
4
5
TOTAL

What is the difference in the total amount paid over the life of the loan (difference in total payments) between Option 1 and Option 2 above?

Question 2 options:

A	35,000.00
B	1317.37
C	1787.80
D	8196.18