You plan to purchase a house for $195,000 using a 30-year mortgage obtained from your local bank.
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You plan to purchase a house for $195,000 using a 30-year mortgage obtained from your local bank. You will make a down payment of 20 percent of the purchase price and monthly payments. You will not pay off the mortgage early. ( LG 7-3 )
a. Your bank offers you the following two options for payment: Option 1: Mortgage rate of 5.5 percent and zero points. Option 2: Mortgage rate of 5.35 percent and 1.5 points. Which option should you choose?
b. Your bank offers you the following two options for payments: Option 1: Mortgage rate of 5.35 percent and 1 point. Option 2: Mortgage rate of 5.25 percent and 2 points. Which option should you choose?
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Related Book For 
Financial Markets And Institutions
ISBN: 9780078034664
5th Edition
Authors: Anthony Saunders, Marcia Cornett
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