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Q. 25 You are contemplating financing (interest only) on a $10,000,000 shopping center. A lender has offered a 72% LTV loan with an interest rate

Q. 25

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You are contemplating financing (interest only) on a $10,000,000 shopping center. A lender has offered a 72% LTV loan with an interest rate of 5%. Another lender is offering a mortgage loan for 80% LTV, but wants an 6% interest rate. What is the effective interest rate on the additional debt contemplated in the second loan? Ch12 a. 1.0% b. 23.6% c. 15.0% d. 19.0%

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