Keeping the time value of money in mind if an investor

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  1. Discuss which rate is actually the cheapest rate.
  2. What are three common mistakes most homebuyers make when looking at quoted mortgage rates?
  3. Based solely on the EAR, which rate is the cheapest? Does this make sense? Explain your answer.
  4. Keeping the time value of money in mind, if an investor chose the 30-year mortgage, what does that say about their opinion of the time value of money?
  5. Why do the different lenders have different rates?
  6. Is the difference in rates going to have a material impact on the cost to the homebuyer? Explain your answer.

Reference no: EM13468817

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