Question
The mortgage on your house is five years old. It required monthly payments of $2005, had an original term of 30 years, and had an
The mortgage on your house is five years old. It required monthly payments of $2005, had an original term of 30 years, and had an interest rate of 5.5% (APR). In the intervening five years, interest rates have fallen and so you have decided to refinancethat is, you will roll over the outstanding balance into a new mortgage. The new mortgage has a 25-year term, requires monthly payments, and has an interest rate of 4.5% (APR). Suppose you are willing to continue making monthly payments of $2005 and want to pay off the mortgage in 25 years. How much additional cash can you borrow today as part of the refinancing? Group of answer choices $93,765.16 $51,362.00 $91,176.28 $34,219.49
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