Question
Two mortgage options are available: (A) a 15-year fixed-rate loan at 6% with no discount points and (B) a 15-year fixed-rate loan at 5.75% with
Two mortgage options are available: (A) a 15-year fixed-rate loan at 6% with no discount points and (B) a 15-year fixed-rate loan at 5.75% with one discount point. Assume you will not pay off the loan early and that the mortgage amount is $100,000.
What is the effective annual yield on each mortgage?
Which mortgage is a better deal?
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Foundations Of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
17th Edition
126001391X, 978-1260013917
