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  3. suppose a homeowner has an existing fixed-rate mor

Suppose a homeowner has an existing fixed-rate mortgage loan with these terms: remaining balance of...

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Accounting

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Suppose a homeowner has an existing fixed-rate mortgage loan with these terms: remaining balance of $273.473.75, interest rate of 4.5%, and remaining term of 25 years (monthly payments). The original loan term was 30 years and the original mortgage amount was $300,000. The payment on the existing loan is $1,520.06. This loan can be replaced by a new $273,473.75 monthly payment loan with an interest rate of 3.00% and a loan term of 25 years. The payment on the new loan would be $1.296,84. The total up-front cost of the refinancing would be 4% of the current outstanding loan amount. Assume the homeowner expects to stay in the home an additional five years from today whether she refinances now or not. Using what is referred to in the book and class notes as "net benefit analysis," what is the net benefit of refinancing today (rounding to the nearest dollar)? $13,393 O $1.483 O $7,022 $2.454 None of the choices is within $10 of the correct

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