Suppose You Are Interested in Taking a Mortgage Loan for $250,000

question 5

Multiple Choice

Suppose you are interested in taking a mortgage loan for $250,000 in order to purchase your principal residence.Your lender has suggested that you might be interested in taking an FHA loan.In order to do so,you must pay an additional up-front mortgage insurance
Premium (UFMIP) of 1.0% of the mortgage balance.If the interest rate on the fully-amortizing mortgage loan is 5% and the term is 30 years,what is your monthly mortgage payment assuming the UFMIP is financed?

• A)$1,342.05
• B)$1,355.47
• C)$1,498.88
• D)$2,500

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Definitions:

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A mental shortcut that relies on the immediate connections between two concepts or objects in the mind to make a decision or solve a problem.

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The skill to arrive at well-thought-out decisions or logical conclusions.

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