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You have a choice between the following two identical properties: Property A is priced at $ 1 5 4 , 8 0 0 with 8
You have a choice between the following two identical properties: Property A is priced at $ with percent financing at a percent interest rate for years. Property B is priced at $ with an assumable mortgage of $ at percent interest with years remaining. Monthly payments are $ A second mortgage for $ can be obtained at percent interest for years. All loans require monthly payments and are fully amortizing.Required:What is the return to the borrower on the additional $ down payment for Alternative B Which alternative is more desirable?If the seller of Alternative B provided a second mortgage for $ at percent, what would be the return to the borrower on the additional $ down payment? Which alternative is more desirable?If the seller of Property B provided a second mortgage for $ at percent such that no additional down payment is required, which alternative is more desirable?
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