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A real estate investor is considering the purchase of a four - unit office building and has the following information. The purchase price is $

A real estate investor is considering the purchase of a four-unit office building and has the following information. The purchase price is $969,351 with $8,456 in acquisition costs. The project can be financed with a first mortgage of $788,101 at an interest rate of 6.4 percent for 30years, monthly payments. Financing costs (discount points, etc.) are estimated at 3 percent of the loan amount. There is a prepayment penalty of 4 percent of the outstanding balance if the loan is paid off within the first 7 years of the mortgage life. The property will be sold and mortgage loan repaid at the EOY 7.
What is the amortized financing cost (AFC) for year 7?

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