A seller is offering a house for sale for $200,000 with an assumable loan with 20 years left of term and a payment of $899 per month and a current balance of $125,529. The buyer can secure a second mortgage for $50,000 at a rate of 12% for 20 years and a payment of $551 per month. What is the effective cost of the combined loans and should the buyer instead refinance with a first mortgage at a rate of 7.5% for the full amount?