What is the effective borrowing cost

Reference no: EM13296307

Consider a $85,000, 9.25%, 15-year, fixed-rate mortgage with monthly payments. a) What is the required monthly payment on this loan? b) Suppose that the borrower must pay 2 discount points when the loan is originated and that the lender charges 3% prepayment penalty on any balance repaid early. What is the APR on this loan? c) What is the effective borrowing cost if the borrower anticipates paying off the loan at the end of five years?

Reference no: EM13296307

Questions Cloud

Find how much work is done on the toboggan by tension force : A person pulls a toboggan for a distance of 41.6 m along the snow with a rope directed 33.8 ° above the snow. How much work is done on the toboggan by the tension force

Explain what is the mass of sulfuric acid per milliliter : To prepare a fertilizer, an engineer dilutes a stock solution of sulfuric acid by adding 23.0 L of 4.75 M acid to enough water to make 500. L. What is the mass of sulfuric acid per milliliter of the diluted solution

Determine what will be the new height of fluid column : A u-tube manometer is used to measure the pressure of a vessel under vacuum. Assume the manometer is open to atmospheric pressure (101.325 kPa) and the density of the fluid in the manometer is 12.0 g/cm3.

Explain the reaction of phosgene with the reagent : Phosgene (COCl2) was used as a poison gas in World War I. Give the product that would be formed from the reaction of phosgene with the following reagent

What is the effective borrowing cost : What is the APR on this loan? c) What is the effective borrowing cost if the borrower anticipates paying off the loan at the end of five years?

Determine the maximum load p that the member can support : A stainless steel tube with an outside diameter of 65 mm and a wall thickness of 5 mm is used as a compression member. If the axial normal stress in the member must be limited to 180 MPa, determine the maximum load P that the member can support.

Determine the work done by the pushing force : A person pushes a 17.2-kg shopping cart at a constant velocity for a distance of 24.2 m on a flat horizontal surface. Determine the work done by the pushing force

What is the borrower effective borrowing cost : Using the fees outlined in part (c), what is the borrower's effective borrowing cost (effective rate) if he plans on holding the loan for 7 years.

Explain what is the poh of a ba(oh)2 solution : What is the pOH of a Ba(OH)2 solution made by dissolving 0.081 grams of Ba(OH)2 in enough water to make 286 mL of solution

User Account

All Pages