Monthly repayments to the credit card company

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William Bunting has credit card debt of $7,200.00. He is considering increasing his home mortgage loan to pay it off. The credit card and home mortgage interest rates are 11.4% and 5.5% respectively. Both loan types are computed on monthly stops. He is intending to increase his home mortgage payments so as to amortise the credit card debt over five years.

a) How much would his monthly repayments to the credit card company be if he intended to pay out the debt over five years?

b) By how much will his mortgage payments increase if he adopts this plan to deal with his credit card debt?

c) How much would he save by transferring his credit card debt to his mortgage?

Reference no: EM132579817

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