A borrower takes-out a partially amortizing loan in the amount of $200,000 for 20 years at 6%
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Question:
A borrower takes-out a partially amortizing loan in the amount of $200,000 for 20 years at 6% APR, compounded monthly. A balance of $50,000 will remain and be paid as a lump sum when the term of this loan expires.
Part(a) what are the monthly mortgage payments the borrower must make to the lender?
Part (b) What is the outstanding balance of the loan after 5 years?
Part(c) At end of 5 years, the borrower decides to make a large payment of $25,000 to the lender. what is the balance of the loan immediately after paymentof this 25,000
part(d) What will be the new monthly mortgage payment the borrower must make after payment of the $25,000?
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