A borrower is making a choice between a mortgage with monthly payments or biweekly payments. The loan will be $240,000 at 6 percent interest for 20 years.

Required:

a. What would be the maturity period if payments are bi-weekly? How much will the borrower pay in total under each payment option? Which choice would be less costly to the borrower?

Maturity period		Years
Total monthly payments	412,664.29
Total bi-weekly payments
Choice of borrower	Bi-weekly payment

b. Assume that the bi-weekly loan was available for 5.75%. What would be the maturity period if payments are bi-weekly? How much will the borrower pay in total under each payment option?

Maturity period		years
Total monthly payments
Total bi-weekly payments
Choice of borrower	Bi-weekly payment