Question: Loan $ 1 0 0 , 0 0 0 ; Interest rate 7 % ; Term 1 5 years; Payments fixed, monthly; Up - front

Loan $100,000; Interest rate 7%; Term 15 years; Payments fixed, monthly; Up-front costs 7% of loan amount. What is the best estimate of the effective borrowing cost if the loan is to be prepaid in eleven years?

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