1. You have decided to buy a house. You can get a mortgage rate of 5.35 percent, and you want your payments to be $1,250 or less. How much can you borrow on a 30-year fixed-rate mortgage?
2. Consider a 15-year, $110,000 mortgage with an interest rate of 5.75 percent. After two years, the borrower (the mortgage issuer) pays it off. How much will the lender receive?
3. Consider a 20-year, $110,000 mortgage with a rate of 5.50 percent. Seven years into the mortgage, rates have fallen to 5 percent. What would be the monthly saving to a homeowner from refinancing the outstanding mortgage balance at the lower rate?