You can afford to pay up to $2000 in payments every month for housing and have $80,000 in savings (you don't anticipate and increase in income/savings). Which of the following mortgages would allow you to buy the most expensive property? a. A 25 year FRM with 2.5% contract interest rate and .9 LTV.
b. A 30 year fully amortizing FRM with 4.2% contract interest rate and .85 LTV.
c. A 30 year FRM with 4.2% contract interest rate, .9 LTV and a balloon payment of $80,000 at the end of the 5th year.
d. A 30 year mortgage with an interest only period of 5 years at a fixed contract rate 3% and 0.95 LTV.