What is the expected annual loan constant

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Reference no: EM131955657

Discussion with lenders indicates that a loan can be obtained fro 75% of a property's market value. Loan terms will probably be 8% interest, 20-year amortization (monthly payments), with the rate renegotiable after 7 years. The property is estimated to be worth $200,000.

a) How much can be borrowed?

b) What will be the annual debt service?

c) What is the expected annual loan constant?

Show all work along with the formulas you used.

Reference no: EM131955657

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