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1. Ann is purchasing a multi-family house in California for $600,000. She is seeking a mortgage loan for $400,000. She went to a local bank,
1. Ann is purchasing a multi-family house in California for $600,000. She is seeking a mortgage loan for $400,000.
She went to a local bank, which offered her a $400,000 mortgage loan at a 4% fixed rate for 5 years with a 25-year amortization schedule.
a) What would his monthly mortgage payment be?
b) At the end of the five-year term what would her balloon payment be?
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