Question
QUESTION 13 Smith is looking for a fully amortizing 30 year Fixed Rate Mortgage with monthly payments for $450,000. Mortgage A has a 4.25% interest
QUESTION 13
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Smith is looking for a fully amortizing 30 year Fixed Rate Mortgage with monthly payments for $450,000.
Mortgage A has a 4.25% interest rate and requires Smith to pay 1.5 points upfront.
Mortgage B has a 5% interest rate and requires Smith to pay zero fees upfront.
Assuming Smith makes payments for 2 years before she sells the house and pays the bank the balance, what is Smiths Annualized IRR from mortgage A?
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Smith is looking for a fully amortizing 30 year Fixed Rate Mortgage with monthly payments for $450,000.
Mortgage A has a 4.25% interest rate and requires Smith to pay 1.5 points upfront.
Mortgage B has a 5% interest rate and requires Smith to pay zero fees upfront.
Assuming Smith makes payments for 2 years before she sells the house and pays the bank the balance, what is Smiths Annualized IRR from mortgage B?
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Authors: Andrew P.C.
1st Edition
1071003925, 978-1071003923
