Question

Oppenheimer Bank is offering a 30​-year mortgage with an APR of 5.05% based on monthly compounding. With this mortgage your monthly payments would be $1,972 per month. In​ addition, Oppenheimer Bank offers you the following​ deal: Instead of making the monthly payment of $1,972 every​ month, you can make half the payment every two weeks​ (so that you will make 52/2=26 payments per​ year).

With this​ plan, how long will it take to pay off the mortgage if the EAR of the loan is​ unchanged? Note: Make sure to round all intermediate calculations to at least 8 decimal places. The number of payments will be __________ which is approximately __________ years.  ​(Round to two decimal places and enter the years rounded to the nearest whole​ number.)

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You have decided to refinance your mortgage. You plan to borrow whatever is outstanding on your current mortgage. The current monthly payment is $2,356 and you have made every payment on time. The original term of the mortgage was 30​ years, and the mortgage is exactly four years and eight months old. You have just made your monthly payment. The mortgage interest rate is 5.750% (APR).

How much do you owe on the mortgage​ today? ​(Note: Be careful not to round any intermediate steps less than six decimal​ places.) The amount you owe today is ​$_____________-.

​(Round to the nearest​ dollar.)

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Answer 1

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