Oppenheimer Bank is offering a 30-year mortgage with an APR of 4.95% based on monthly compounding. With this mortgage, your monthly payments would be $1,964 per month. In addition, Oppenheimer Bank offers you the following deal: Instead of making the monthly payment of $1,964 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.
Oppenheimer Bank is offering a 30-year mortgage with an APR of 4.95% based on monthly compounding. With this mortgage, your monthly payments would be $1,964 per month. In addition, Oppenheimer Bank offers you the following deal: Instead of making the monthly payment of $1,964 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.
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 15P
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![Oppenheimer Bank is offering a 30-year mortgage with an APR of 4.95%
based on monthly compounding. With this mortgage, your monthly
payments would be $1,964 per month. In addition, Oppenheimer Bank
offers you the following deal: Instead of making the monthly payment of
$1,964 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.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F0eb03798-68ea-49c2-9fab-df3324894e0a%2F8efe136f-c56a-4c2a-be73-6609917182d7%2F8t64xll_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Oppenheimer Bank is offering a 30-year mortgage with an APR of 4.95%
based on monthly compounding. With this mortgage, your monthly
payments would be $1,964 per month. In addition, Oppenheimer Bank
offers you the following deal: Instead of making the monthly payment of
$1,964 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.
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