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Show all work in Excel please! 4. Your local bank has offered you a 20-year, $100,000 mortgage. The bank is charging 1.5 points, with processing
Show all work in Excel please!
4. Your local bank has offered you a 20-year, $100,000 mortgage. The bank is charging 1.5 points, with "processing" costs of $750; both points and processing costs are deducted from the mortgage when it is given. The mortgage carries a 10% annual interest rate and is paid in equal monthly payments. Note that the monthly payments on the mortgage are calculated on full amount of the mortgage (that is, $100,000). (12 points) Calculate the monthly payment on the mortgage, show the amortization table, and compute the EAIR. Compute the total interest paid over the during of the loan using the amortization table. Use Cumipmt to get the total interest paid over the duration of the loan. Change the loan period to 6 years and repeat part a-c. Will the EAIR of the mortgage change if the loan period is only 6 years? Which one (20-year loan vs. 6-year loan) has higher EAIR? Which one has higher total interest paid Step by Step Solution
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