A floating rate mortgage loan is made for $100,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $800.

What if the interest rate increases to 13 percent at the end of year 1? How much interest will be accrued as negative amortization in year 2 if the payment remains at $800?

Question 8 options:

	$9,600
	$3,960.20
	$13,560.20
	$19,432.85