When you purchased your house, you took out a 30-year annual-payment mortgage with an interest rate of
Question:
When you purchased your house, you took out a 30-year annual-payment mortgage with an interest rate of 9% per year. The annual payment on the mortgage is $9588. You have just made a payment and have now decided to pay the mortgage off by repaying the outstanding balance.
What is the payoff amount if
a. You have lived in the house for 10 years (so there are 20 years left on the mortgage)?
b. You have lived in the house for 20 years (so there are 10 years left on the mortgage)?
c. You have lived in the house for 10 years (so there are 20 years left on the mortgage) and you decide to pay off the mortgage immediately before the tenth payment is due?
AppendixLO1
Step by Step Answer:
Corporate Finance The Core
ISBN: 9781292431611
5th Global Edition
Authors: Jonathan Berk, Peter DeMarzo