1. Maria and John have been married for 2 years and just learned that they are pregnant. They have been renting a small apartment but decide to purchase a house. The one they have found has a selling price of $300,000. They will make a 20% down payment.

They are considering 2 financing options at their credit union:

Option 1:3.125% interest 30-year mortgage:

Option 2:2.5% interest 15-year mortgage:

Answer the following questions showing all your work to reach each answer.

A. Which option will result in alower monthly paymentif they take the full term of the mortgage? What will that monthly payment be?

B. Which option will result in themost total interestif they take the full term of the mortgage? What will that total interest be?