Five years ago you took out a 30-year mortgage with an APR of 6.5% for $200,000. If you were torefinance the mortgage today for 20 years at an APR of 4.25%, how much would your monthly payment change by?

Question

Quizplus · Accepted Answer

The original mortgage payment was based on a 6.5% APR for 30 years. Refinancing to a 4.25% APR for 20 years reduces the interest rate and the remaining term, resulting in a lower monthly payment. The decrease is calculated to be $104.79.

Five Years Ago You Took Out a 30-Year Mortgage with an APR