A borrower is purchasing a property for $725,000 and can choose between two possible loan alternatives. The first is 85% LTV loan for 30 years
A borrower is purchasing a property for $725,000 and can choose between two possible loan alternatives. The first is 85% LTV loan for 30 years at 3.5% interest and 1 point and the second is at 70% LTV loan for 30 years at 2.875% interest and no points. Assuming the loan will be repaid in 5 years, what is the incremental cost of borrowing the extra money?
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Authors: Hal Scott, Anna Gelpern
21st Edition
1634602048, 978-1634602044
