Richard smith of portland oregon has owned his home for 15, Ask an Expert

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Richard Smith of Portland, Oregon, has owned his home for 15 years and expects to live in it for five more years. He originally borrowed $105,000 at 6 percent interest for 30 years to buy the home. He still owes $65,750 on the loan. Interest rates have since fallen to 5.0 percent, and Richard is considering refinancing the loan for 15 years. He would have to pay 2 points on the new loan with no prepayment penalty on the current loan.

(a) What is Richard's current monthly payment?

(b) Calculate the monthly payment on the new loan.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92317938

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