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The Blue Algae Mortgage Company has originated a pool containing 75 ten-year fixed rate mortgages with an average balance of $100,000 each with 1% origination
| The Blue Algae Mortgage Company has originated a pool containing 75 ten-year fixed rate mortgages with an average balance of $100,000 each with 1% origination fee. The annual interest rate on all loans in the pool is 12% and all loans require monthly payments. | |||||||
| Initial Pool Balance | |||||||
| Annual Interest Rate | |||||||
| Maturity (years) | |||||||
| Payments per year | |||||||
| Question 1: What price should Blue Algae obtain if the pool is sold immediately to an investor with a required annual return of 11% and no prepayment is expected? | |||||||
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Meetings Expositions Events And Conventions An Introduction To The Industry
Authors: George Fenich
5th Edition
0134735900, 9780134735900
