Question

Patricia got a 5/25 balloon mortgage and her initial payments were $965. She

Answer 1

Answer:

$390,900

Step-by-step explanation:

Given that.

Initial payment = $965

New rapayment = $925

when she decided to refinance her ballon payment with a 30 year mortgage

In this case,

a 5/25 ballon mortgage simply means loan repayment for the first 5 years is at a fixed rate.

Which means the total amount she paid in the first five years was=

12 * 5 * $965

= $57,900

When she refinanced the payment with a 30 year mortgage, her total payment

= $925 * 12 * 30years

= $333,000

Total financed cost Patricia paid =

$57,900 + $333,000

= $390,900