Answered step by step
Verified Expert Solution
Question
1 Approved Answer
g. If this is a negative amortizing loan and the borrower and lender agree that the loan balance of $150,000 will be payable at the
g. If this is a negative amortizing loan and the borrower and lender agree that the loan balance of $150,000 will be payable at the end of year 20:
(1) How much total interest will be paid from all payments? How much total principal will be paid?
(2) What will be the loan balance at the end of year 3?
(3) If the loan is repaid at the end of year 3, what will be the effective rate of interest?
(4) If the lender charges 4 points to make this loan, what will the effective rate of interest be if the loan is repaid at the end of year 3?
If this is a negative amortizing loan and the borrower and lender agree that the loan balance of $150,000 will be payable at the end of year 20: (1) How much total interest will be paid from all payments? How much total principal will be paid? Note: Round your final answer to 2 decimal places. (2) What will be the loan balance at the end of year 3? Note: Round your final answer to 2 decimal places. (3) If the loan is repaid at the end of year 3, what will be the effective rate of interest? (4) If the lender charges 4 points to make this loan, what will the effective rate of interest be if the loan is repaid at the end of year 3? Note: Round your final answer to 2 decimal places. g1. Total interest g1. Total principal g2. Loan balance g3. Effective rate of interest g4. Effective rate of interest if lender charges 4 points $
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started