A 30-year fully amortizing mortgage loan was made 10 years ago for $75,000 at 6 percent interest.
Question:
A 30-year fully amortizing mortgage loan was made 10 years ago for $75,000 at 6 percent interest. The borrower would like to prepay the mortgage balance by $10,000.
a. Assuming he can reduce his monthly mortgage payments, what is the new mortgage payment?
b. Assuming the loan maturity is shortened and using the original monthly payments, what is the new loan maturity?
MaturityMaturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...
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Step 1 Solve for the original monthly payment i 612 or 050 n 30x12 or 360 PV 75000 FV 0 Solve for pa...View the full answer
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Related Book For 
Real Estate Finance and Investments
ISBN: 978-0073377339
14th edition
Authors: William Brueggeman, Jeffrey Fisher
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