LO1 You have a mortgage balance of $120,000 that will require you to make 120 more payments of $1,200 , starting next month. Alternatively, you can take out a loan today for $120,000 with an interest rate of 3% APR compounded monthly and pay off the original mortgage. The new loan will require you to make 120 more payments, starting next month. If your investments earn 4.00% APR, compounded monthly, how much will you save in PV terms by taking out the new loan to pay off the original mortgage?

$4,076

$3,996

$3,958

$4,199