Ten years ago, you took out a $400,000 mortgage to buy a new house. The mortgage was a 20-\\nyear, 5% mortgage with annual payments. Today Hong Kong Shanghai Bank (HSBC) offers you \\na similar mortgage at 3% interest. However, when you contacted HSBC to inquire about the \\npossibility of refinancing the reminder of your mortgage with a 10-year, 3% mortgage, you were \\ntold by HSBC that you will have to pay a $10,000 “refinance fee” for the refinancing. Should \\nyou still refinance the mortgage?
Ten years ago, you took out a $400,000 mortgage to buy a new house. The mortgage was a 20-\\nyear, 5% mortgage with annual payments. Today Hong Kong Shanghai Bank (HSBC) offers you \\na similar mortgage at 3% interest. However, when you contacted HSBC to inquire about the \\npossibility of refinancing the reminder of your mortgage with a 10-year, 3% mortgage, you were \\ntold by HSBC that you will have to pay a $10,000 “refinance fee” for the refinancing. Should \\nyou still refinance the mortgage?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Ten years ago, you took out a $400,000 mortgage to buy a new house. The mortgage was a 20-\\nyear, 5% mortgage with annual payments. Today Hong Kong Shanghai Bank (HSBC) offers you \\na similar mortgage at 3% interest. However, when you contacted HSBC to inquire about the \\npossibility of refinancing the reminder of your mortgage with a 10-year, 3% mortgage, you were \\ntold by HSBC that you will have to pay a $10,000 “refinance fee” for the refinancing. Should \\nyou still refinance the mortgage?
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