A borrower purchases a property for $200,000 and pays 20% of the sale price as a down payment. The owner provides a purchase money mortgage at 6% per annum, interest- only monthly payments with a balloon payment in 60 months. In the 40th month, the borrower is approached to sell the property for $240,000. How much equity does the borrower have and what will his sale proceeds be (without any other closing costs)? Question 7 Select one: a. $40,000 b. $72,000 c. $80,000 d. $240,000