A: Mr. Fisher has secured a 30 year, $205,000 loan at 7% with monthly payments. Fifteen years later, an investor wants to purchase the loan from the lender. If market interest rates are 5%, what would the investor be willing to pay for the loan?

B: Mr. Fisher has built several houses and is offering buyers mortgage rates of 10% with a 15 year term. Current rates are 10.75%. Fourth National Bank will provide the loans, if Mr. Fisher pays an equivalent amount up front to buy down the interest rate. If a house is sold for $377,000 with a 90% loan, how much would Mr. Fisher have to pay to buy down the loan?

C: A 10-year mortgage carries an interest rate of 2.00% and a 15-year mortgage carries an interest rate of 2.50%. What is the incremental borrowing cost of the 15-year loan over the 10-year loan?