Question
A 15-year, 12% mortgage for $100,000 has ANNUAL payments structured in the following way: for the first 10 years the payment is equal to just
A 15-year, 12% mortgage for $100,000 has ANNUAL payments structured in the following way: for the first 10 years the payment is equal to just one half of the accrued interest for the respective year; for the remaining five years the payment is constant assuming full amortization of the outstanding mortgage balance over the remaining term of the loan. What is the loans balance at the end of year 5?
A. | Between $80,000 and $90,000 | |
B. | Between $90,000 and $100,000 | |
C. | Between $100,000 and $110,000 | |
D. | Between $110,000 and $120,000 | |
E. | Between $120,000 and $130,000 | |
F. | Between $130,000 and $140,000 | |
G. | Between $140,000 and $150,000 | |
H. | Between $150,000 and $160,000 |
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