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What is the monthly payment of the new mortgage

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Seven years ago a borrower took a mortgage for $150,000 at 6% for 30 years. Currently, the market interest rate is 5.25%. Consider this 30-year mortgage the old mortgage. The existing mortgage has a prepayment penalty of 3% of the outstanding loan balance. The closing cost of the new mortgage is 2% of the loan amount. The borrower is considering refinancing to a new 23-year mortgage at the current interest rate. Assume that this 23-year mortgage is the new mortgage. What is the monthly payment of the new mortgage?

Reference no: EM133070095

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