Lando Calniman, a TrSIM real nitate alumnun, putchaped a home on the corner of Ontano and Dundad. Lave month the house had a market (appraied) value of $600,00000, but today he diecoven that the house value has depreciated by five percent ance then. Today in alas the due date for his monthly payment on a mortgeree which has a dincounted unpaid balance of $589,000,00 tundo in tempted to istategcally default on hir mortgage. Knowing that Lando is trying to make the decinco between defaultang and repaying the morteage, his lender informe him that the act. of default by itself, will impare a direct cont to him, independent of hie low of equity, and that he needs to take thin into accoune when thinking about defaulting. The lender also given Lando an atimate, expreased pur a percentage of the houee value at which Lando would be indifferent between defaulting and repaying in the aboence of default coets, of the dollar coete he will incur in the event of default. The lender has no idea of what hir real defaulo coct would be, but wante to gve Lando an artirnate that will dircuado him from defaulting. To do this, the lender has to calculate the critical percentage that would make Lando exactly indifferent to paying has mortgage coup on today or defaulting. What is this value? 3% 1% 79 1295 087 Lando Calniman, a TrSIM real nitate alumnun, putchaped a home on the corner of Ontano and Dundad. Lave month the house had a market (appraied) value of $600,00000, but today he diecoven that the house value has depreciated by five percent ance then. Today in alas the due date for his monthly payment on a mortgeree which has a dincounted unpaid balance of $589,000,00 tundo in tempted to istategcally default on hir mortgage. Knowing that Lando is trying to make the decinco between defaultang and repaying the morteage, his lender informe him that the act. of default by itself, will impare a direct cont to him, independent of hie low of equity, and that he needs to take thin into accoune when thinking about defaulting. The lender also given Lando an atimate, expreased pur a percentage of the houee value at which Lando would be indifferent between defaulting and repaying in the aboence of default coets, of the dollar coete he will incur in the event of default. The lender has no idea of what hir real defaulo coct would be, but wante to gve Lando an artirnate that will dircuado him from defaulting. To do this, the lender has to calculate the critical percentage that would make Lando exactly indifferent to paying has mortgage coup on today or defaulting. What is this value? 3% 1% 79 1295 087