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Amy is purchasing a new house in College Park, MD costing $400,000 with a 20% down payment. The 30 year mortgage has a primary interest
Amy is purchasing a new house in College Park, MD costing $400,000 with a 20% down payment. The 30 year mortgage has a primary interest rate of 4%, and it is an additional $500 per month to cover home insurance and property tax (escrow account). After 5 years of paying the mortgage, Amy wants to refinance the mortgage for 25 years at 3% interest rate. What is the payoff amount and the savings in monthly mortgage payment, assuming her escrow payments stay the same?
- Payoff=$228,336; Monthly Payment Savings= $322
- Payoff=$289,432; Monthly Payment Savings= $155
- Payoff=$228,320; Monthly Payment Savings= $445
- Payoff=$361,790; Monthly Payment Savings= $194
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