Seven years ago a borrower took a mortgage for $150,000 at 6% for 30 years. We call this 30-year mortgage as the old mortgage. Currently, the market interest rate is 5.25%. The borrower is considering refinancing to a new 23- year mortgage at the current interest rate. We call this 23-year mortgage as the new mortgage. The lender has a prepayment penalty of 3% of the outstanding loan balance and the closing cost of the new mortgage is 2% of the loan amount. What is the refinancing cost? * 5% outstanding loan balance of the old mortgage at year 7 2% outstanding loan balance of the old mortgage at year 7 3% outstanding loan balance of the old mortgage at year 7 5% yearly payment of the old mortgage

Ma & Pa General Store is taking out a mortgage for a new building. It is going to be an interest-only, 15-year balloon mortgage for $350,000. The APR is 4.25%. The last payment will be the balloon payment of the full principal. What is their balloon mortgage payment?

A mortgage broker is offering a $279,000 30-year mortgage with a teaser rate. In the first two years of the mortgage, the borrower makes monthly payments on only a 4.5 percent APR interest rate. After the second year, the mortgage interest rate charged increases to 7.5 percent APR. What are the monthly payments in the first two years? (Do not round intermediate calculations and round your final answer to 2 decimal places.) Monthly payment What are the monthly payments after the second year? (Do not round intermediate calculations and round your final answer to 2 decimal places.) Monthly payment > 2 D TRENE VAR TVUNG S 2006- E - E

The Mendez family is considering a mortgage loan of $350,000 at an annual interest rate of 6.55%. (a) How much greater is their mortgage payment if the term is 20 years rather than 30 years?(b) How much less is the amount of interest paid over the life of the 20-year loan than over the life of the 30-year loan?

A homeowner took out a 15-year fixed-rate mortgage of $140,000. The mortgage was taken out 7 years ago at a rate of 7.4 percent. If the homeowner refinances, the charges will be $1,000. What is the highest interest rate at which it would be beneficial to refinance the mortgage? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. APR %

Four years ago, you took out a $375,000, 25-year mortgage with an interest rate of 5% and a 3% prepayment fee applicable for the first five years. If you decide to pay off this mortgage now, what will the balance due be?

David obtained a fully amortizing loan 8 years ago for $12,0000 at 8% for 30 years. Mortgage rates have dropped in such a manner so as to provide a loan for 22 years at 6.5%. There is no prepayment penalty on the mortgage balance of the original loan, but 2 points will be charged on the new loan and other closing cost will be $3000. All payments are monthly.       How much does David need to borrow if he decides to borrow only outstanding loan balance?   Is refinancing a good option if David decides to repay the full amount of loan in 5 more years?   How would your answer for part 2a change if David decides to borrow outstanding loan balance and other refinancing costs?   Would your answer for part 2b change if David decides to keep the loan for full term of the loan?

A mortgage broker is offering a $279,000 30-year mortgage with a teaser rate. In the first two years of the mortgage, the borrower makes monthly payments on only a 4.5 percent APR interest rate. After the second year, the mortgage interest rate charged increases to 7.5 percent APR. What are the monthly payments in the first two years? (Do not round intermediate calculations and round your final answer to 2 decimal places.) Monthly payment What are the monthly payments after the second year? (Do not round intermediate calculations and round your final answer to 2 decimal places.) Monthly payment

A homeowner took out a 20-year fixed-rate mortgage of $175,000. The mortgage was taken out 6 years ago at a rate of 6.75 percent. If the homeowner refinances, the charges will be $3,050. What is the highest interest rate at which it would be beneficial to refinance the mortgage? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Answer is complete but not entirely correct. APR 6.00

Mr. Tramp made a mortgage 5 years ago for $85, 000 at 8.25% interest and a 15 year term. Rates have now risen to 10% for an equivalent loan. Mr. Tramps lender is willing to discount the loan by $2, 000 if he will prepay the loan. What rate of return would Mr. Tramp receive by prepaying the loan?(A)7.83% (B) 10.24% (C) 14.32% (D) 9.14%