Question: What is your effective borrowing cost (EBC) if you plan to move in 5 years? Situation: a lender is offering you a $300,000 30-year FRM

What is your effective borrowing cost (EBC) if you plan to move in 5 years? Situation: a lender is offering you a $300,000 30-year FRM at 7.2%. This is how you solve for monthly payment over life of loan: PV= 300,000 I= 7.2/12 N= 30 x 12 = 360 mo FV= 0 (b/c fully amortizes) PMT= $2,036.36

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