If the lender charges upfront points on a loan, what effect will prepayment of the loan...
If the lender charges upfront points on a loan, what effect will prepayment of the loan have on the lender?
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Homework Answers
Points are percentage of loan paid upfront. In this kind of situations, if loan is paid off early effective yield will increase. Interest paid and points paid will increase the yield on loan to borrower.
Hence, correct option is (1) higher yield for the lender.
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If the lender charges upfront points on a loan, what effect will
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May I please have help with these? also how would I put this in the calculator?...
May I please have help with these? also how would I
put this in the calculator?
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May I please have help with these? also how would I
put this in the calculator?
For 26-30) A borrower is faced with choosing between two mortgages: Loan B 80,000 25 yr 10.5% 2 pt 496 Loan A Loan amount Term Interest rate Discount points Prepayment penalty 80,000 25 yr 10% 5 pt 0% Assuming monthly payments, if the loans are a. Loan A b. Loan B c. Both loan are same d. Can not determined with the info given...
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