Task 1: Fixed-Rate, Fixed-Payment Mortgages Loan amount: $2,000,000 Loan term: 10 years Partially amortizing over 25 years 7% effective annual rate Quarterly payments 2% origination fee 2.5% prepayment penalty 1. What is the quarterly payment? 2. What is the outstanding loan balance after 5 years? 3. What was the principal paid in year 5? How much interest was paid in year 5? 4. Assuming the mortgage is repaid at full term, what is the yield to the lender? 5. What is the yield to the lender if the mortgage is pre-paid at the end of year 6?