What is the effective yield to the lender on a $100,000 loan at 5.75 percent interest, with monthly payments amortized over 25 years if the lender charges 2 points at origination, and the loan is outstanding for the entire amortization period?
1 5.75%
2. 5.96%
3 6.05%
4. 5.43%
-100000+2%*100000+100000*(5.75%/12)/(1-1/(1+5.75%/12)^(12*25))*1/(IRR/12)*(1-1/(1+IRR/12)^(12*25))=0
=>IRR=5.9614%
What is the effective yield to the lender on a $100,000 loan at 5.75 percent interest,...