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Suppose that you are considering borrowing $350,000 using a 30-year loan with an annual interest rate of 10% with monthly payments and compounding. The lender
Suppose that you are considering borrowing $350,000 using a 30-year loan with an annual interest rate of 10% with monthly payments and compounding. The lender is also going to charge you a 0.5% origination fee and 1.25 discount points. Finally, the loan will also have third-party closing costs of $950. What will the annual effective borrowing cost for this loan be if you make all of the scheduled payments on the loan? 9.42% 10.65% 10.85% 10.24%
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