Your mortgage loan has an outstanding principal balance of $154,914 and 240 months remaining until maturity when it will be paid in full. You are considering whether to refinance the existing balance at 3.25%. You want to keep the maturity the same, so a new (refinance) mortgage loan would have a 240-month loan term. Your existing mortgage loan requires monthly payments of $959.28. Assuming the mortgage lender charges an origination fee of $2,500, would it be economical for you to consider the refinance opportunity if an alternative investment would be expected to yield 12% and what do you estimate for the leveraged before tax IRR?

Answer Choices:

Yes and 3.28%

Yes and 38.68%

No and 3.28%

No and 38.68%