The recent drop in the mortgage interest rates

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Given the recent drop in the mortgage interest rates, you have decided to refinance your home. Exactly five years ago, you obtained a $150 000 30-year mortgage with a fixed rate of 10%.Today, you can get a 30 year loan for the outstanding loan balance at 7.5% interest rates. 7.5% interest. This loan however requires you to pay a $500 appraisal fee and 2 points at the time of the refinancing (1 point 1% of the amount borrowed), Ignore the tax considerations. By how much will your monthly payments drop if you refinance.

Reference no: EM131073335

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