Question: You purchased a home using a $ 4 0 0 , 0 0 0 mortgage 8 months ago. The rate on the loan is 7

You purchased a home using a $400,000 mortgage 8 months ago. The rate on the loan is 7.625% and the original loan term was 30 years.
Your banker called a few minutes ago and mentioned that rates have dropped and a new 30-year mortgage is available with a rate of 6.875%. The up-front cost of obtaining this mortgage would be $3,800.
What is your net benefit to refinancing using the full loan term? Assume that the new loan amount is equal to the existing loan balance

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