Question: When purchasing a $210,000 house, a borrower is comparing two loan alternatives. The first is 85% at 9.75% for 15 years. The second is 90%

When purchasing a $210,000 house, a borrower is comparing two loan alternatives. The first is 85% at 9.75% for 15 years. The second is 90% at 10.5% for 15 years. If both loans requires monthly payment and will be held to maturity, what is the incremental cost of taking the second alternative?

a. 21.76%

b. 19.17%

c. 16.42%

d. 13.39%

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