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Vanessa is a builder. Interest rates are high, so, to sell her newly developed properties faster, she is offering $100,000, 25-year term loans for buyers
Vanessa is a builder. Interest rates are high, so, to sell her newly developed properties faster, she is offering $100,000, 25-year term loans for buyers of her new construction houses at 9%. Current market rates are 9.5%. The houses would normally sell for $110,000 without any special financing.
At what price should Vanessa sell the houses to earn, in effect, the market rate of interest on the loan?
Assume that buyers all hold the loan until maturity.
Round two decimal places.
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