What is the dollar amount of the balloon payment

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Reference no: EM131996110

A mortgage loan of $200,000 has just been made on a property valued at $250,000. The interest rate is 5% with 2 points with a 10 year balloon. Monthly amortization payments are based on a 30 year maturity. The mortgage also carries a 2% prepayment penalty.

1. What is the dollar amount of the balloon payment?

2. If the mortgage is paid off after 6 years what will the effective yield be?

Reference no: EM131996110

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