Scenario 2 You are financing the purchase of a $600,000 house but you only have enough savings to make a 5% down payment ($30,000). You have two options to finance the property: 1. Through a $480,000 (80% LTV) first-mortgage at 5% interest plus a second-mortgage for the missing $90,000 (15% LTV) at 10% interest. At origination, 4 points will be charged on both loans 2. Through a $570,000 (95% LTV) first-mortgage at 6.0% interest. No points are charged on this loan. Assume all loans are held to their 20-year maturities and are fixed-rate with monthly compounding and monthly payments. Question 27 2B. Referring to Scenario 2 above, as the borrower, which loan should you choose? O Option #2 O Option #1