Calculate the effect of points to be paid on loan
Course:- Financial Management
Reference No.:- EM13942907

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Calculate the effect of points to be paid on a $200,000 loan at 8%, monthly payments with a 30 year term given the following scenarios:

a. assuming 4 points and the loan is held to maturity.

b. assuming the points are paid and the loan is paid off at end of year 7.

c. assuming that in addition to the points a 3% prepayment penalty is paid at the end of year 7.

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