When Gustavo and Serrana bought their home, they had a 5.7% loan with monthly payments of $870.60 for 30 years. After making 78 monthly payments, they plan to refinance for an amount that includes an additional $35,000 to remodel their kitchen. They can refinance at 4.8% compounded monthly for 25 years, with refinancing costs of $625 included with the amount refinanced. Find the amount refinanced . Find their new monthly payment . How long will it take to pay off this new loan if they pay $1200 each month ?

When Gustavo and Serrana bought their home, they had a 5.7% loan with monthly payments of $870.60 for 30 years. After making 78 monthly payments, they plan to refinance for an amount that includes an additional $35,000 to remodel their kitchen. They can refinance at 4.8% compounded monthly for 25 years, with refinancing costs of $625 included with the amount refinanced. Find the amount refinanced . Find their new monthly payment . How long will it take to pay off this new loan if they pay $1200 each month ?

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 25PROB

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When Gustavo and Serrana bought their home, they had a 5.9% loan with monthly payments of $870.60 for 30 years. After making 78 monthly payments, they plan to refinance for an amount that includes an additional $35,000 to remodel their kitchen. They can refinance at 4.2% compounded monthly for 25 years with refinancing costs of $625 included with the amount refinanced. How long will it take to pay off this new loan if they pay $1200 each month?
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