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Calculate the monthly payment on the mortgage

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Reference no: EM132944218

Your bank has offered you a 10-year, $100,000 mortgage with monthly payments. The bank is charging 1.5 points and a $750 "processing" fee, both are deducted from the mortgage when it is given. The APR on the mortgage is 12%.

Problem a. Calculate the monthly payment on the mortgage, show the amortization table, and compute the EAR.

Problem b. Will the EAR of the mortgage change if the term of the loan is 6 years?

Problem c. Compute the total interest paid in each of the year of the mortgage.

data

A Monthly Mortgage
Mortgage principal 100,000
Annual interest rate 12%
Monthly interest rate 1%
"Points" 1.50
Origination Fee 750.00
Mortgage term (years) 10

Reference no: EM132944218

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