A property was purchased 3 years ago for $5 million with a 70% LTV mortgage with a rate of 6.75%. The loan had a 25-year amortization.

The property is now worth $6.3 million (according to a bank-ordered appraisal). If the buyer is going to refinance at the end of the 36th month and get a NEW 70% LTV loan, how much cash will they receive in the refinance? Ignore any closing costs or other transaction costs. Further, assume the buyer has ONLY made the REQUIRED payments over the 36 months to now.

For the purposes of this question, assume monthly payments and round your answer to the nearest $1000.

options

$1,089,000

$1,276,000

$2,067,000

$2,979,000

$1,043,000