You need a 20-year, fixed-rate mortgage to buy a new home for $220,000. Your mortgage bank will lend you the money at a 7.6 percent APR for this 240-month loan. However, you can afford monthly payments of only $850, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at $850?

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