please show how to solve this in excel and please show the formulas needed Two years ago, you purchase a house of $500,000. You borrow a mortgage with 80% of LTV (loan to value ratio). The interest rate on the mortgage is 6.25%. Payment terms are being made monthly to amortize the loan over 30 years. You have found another lender who will refinance the current outstanding loan balance plus all the costs associated with the new loan at 5% with monthly payments for 30 years. Suppose that the new lender will charge 2.5 discount points on the new loan and other refinancing costs will equal $10,000. What is the new loan amount if you choose to refinance? Should you refinance if you hold the loan for 30 years? If you choose to refinance, at least how many years should you stay in the house (do not prepay)? Why?

please show how to solve this in excel and please show the formulas needed Two years ago, you purchase a house of $500,000. You borrow a mortgage with 80% of LTV (loan to value ratio). The interest rate on the mortgage is 6.25%. Payment terms are being made monthly to amortize the loan over 30 years. You have found another lender who will refinance the current outstanding loan balance plus all the costs associated with the new loan at 5% with monthly payments for 30 years. Suppose that the new lender will charge 2.5 discount points on the new loan and other refinancing costs will equal $10,000. What is the new loan amount if you choose to refinance? Should you refinance if you hold the loan for 30 years? If you choose to refinance, at least how many years should you stay in the house (do not prepay)? Why?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 15P

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