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You are buying a house and the mortgage company offers to let you pay a...

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Accounting

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You are buying a house and the mortgage company offers to let you pay a "point (1,0% of the total amount of the loan) to reduce your APR from 6.07% to 5.82% on your $422,000, 30-year mortgage with monthly payments. If you plan to be in the house for at least five years, should you do it? (Note: Be careful not to round any Intermediate steps less than six decimal places) The monthly mortgage payment at 6.07% APR is $ (Round to the nearest cent.) The monthly mortgage payment at 5.82% APR is $(Round to the nearest cent.) The lower interest rate on the mortgage results in monthly savings of $ (Round to the nearest cent.) The PV of the monthly savings is $(Round to the nearest cent.) The balance of the mortgage at the end of five years at 6.07% APR is $). (Round to the nearest cont.) The balance of the mortgage at the end of five years at 5.82% APR is $. (Round to the nearest cont.) The principal reduction due to the lower interest rate is $(Round to the nearest cent.) The PV of the principal reduction is $. (Round to the nearest cent.) The net benefit or cost is $ (Round to the nearest cent.) The net benefit is therefore, you pay the point. (Select from the drop-down menus

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