Consider a $2 million, 7

Subject:FinancePrice: Bought3

Share With

Consider a $2 million, 7.5%, 30-year mortgage with monthly payments and an expected realistic prepayment horizon of eight years. What is the contractual yield (effective interest rate) at issuance over the expected life of the loan under the following circumstance: one point of disbursement discount?

a.7.851%

b.7.936%

c.7.674%

d.7.5%