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What is mortgage balance at beginning of year

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Question

Assume we have a PLAM for a $450,000 mortgage with a 30-year term and monthly payments. The "real" loan rate is 4%, with inflation rates of 6%, 5%, and 4% for years 1, 2, and 3, respectively. The inflation adjustments to the loan balance are assumed to be made annually. What is the mortgage balance at the beginning of year 4?

Reference no: EM133496098

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