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Consider two physically identical properties A and B. Property A's current asking price is $570,000 and Property B's asking price is $522,497. Property A's current

Consider two physically identical properties A and B. Property A's current asking price is $570,000 and Property B's asking price is $522,497. Property A's current owner has a 25-year remaining maturity assumable mortgage of $473,100 at a fixed mortgage rate of 11.40%. Property B's current owner has a 25 year remaining maturity non-assumable mortgage of $473,100 at a fixed mortgage rate. The current market mortgage rate for 25-year maturity conventional (not assumable) mortgage is 13.15%. In either Case (A or B), the buyer would have the same amount $473,100 of 25-year fixed rate mortgage financing. The Buyer's Alternative Investment Return is 14.45%.

a) what is the cash equivalent value of property A's assumable mortgage?

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