#3. To buy your dream home you use a 4/16 reset loan that pays interest only (bullet loan) for the first 4 years, followed with a reset payment to amortize over the remaining 16 years. The Ioan amount is $280,000 at 4.75%, with 2 discount points (to the lender) and $1450 in third party closing costs which the borrower must pay. f) What is your balance 6 years after you take out the loan? g) If you repay this loan after 6 years, what is the yield (expressed as an APR) for the lender? h) What is the yield expressed as an EAR? i) If you repay this loan after 6 years, what is the effective borrower cost (EBC) to you (expressed as an APR)? j) What is the EBC expressed as an EAR? #3. To buy your dream home you use a 4/16 reset loan that pays interest only (bullet loan) for the first 4 years, followed with a reset payment to amortize over the remaining 16 years. The Ioan amount is $280,000 at 4.75%, with 2 discount points (to the lender) and $1450 in third party closing costs which the borrower must pay. f) What is your balance 6 years after you take out the loan? g) If you repay this loan after 6 years, what is the yield (expressed as an APR) for the lender? h) What is the yield expressed as an EAR? i) If you repay this loan after 6 years, what is the effective borrower cost (EBC) to you (expressed as an APR)? j) What is the EBC expressed as an EAR