23. A borrower secures a 10-year interest only loan for $500,000 at a rate of 6%. The loan is prepayable after year-5 for a fee that is the greater of yield maintenance or 5% of the outstanding principal balance.

Rates have increased to 8%, but the borrower wants to prepay the loan at the end of five years so he can sell the property. What is the prepayment penalty (rounded to the nearest $1,000)?

A. $0

B. $123,000

C. $25,000

D. $129,000

22. A borrower secures a 10-year interest only loan for $500,000 at a rate of 6%. The loan is prepayable after year-5 for a fee that is the greater of yield maintenance or 5% of the outstanding principal balance.

Rates have gone down to 4%, but the borrower wants to prepay the loan at the end of five years so he can sell the property. What is the prepayment penalty (rounded to the nearest $1,000)?

A. $136,000

B. $129,000

C. $25,000

D. 45,000

E. $111,000