The Switzers are nearing the end of the first five-year term of a $95,000 mortgage loan with a 25-year amortization. The interest rate has been 6.5% compounded semiannually for the initial term. How much will their monthly payments increase if the interest rate upon renewal is 7.5% compounded semiannually and the original amortization period is continued? (Do not round the intermediate calculations. Round your answer to two decimal places.)
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
The Switzers are nearing the end of the first five-year term of a $95,000 mortgage loan with a 25-year amortization. The interest rate has been 6.5% compounded semiannually for the initial term. How much will their monthly payments increase if the interest rate upon renewal is 7.5% compounded semiannually and the original amortization period is continued? (Do not round the intermediate calculations. Round your answer to two decimal places.)
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