One Hundred Identical Mortgages Are Pooled Together into a Pass-Through

One hundred identical mortgages are pooled together into a pass-through security.Each mortgage has a $150,000 principal,a fixed annual interest rate of 8 percent (paid monthly) ,and is fully amortized over a term of 30 years.

What is the present value of the mortgage pass-through if,immediately after origination,interest rates increase to 8.25 percent per annum?

A) $15,000,000.
B) $14,650,591.
C) $14,000,000.
D) $15,115,493.

Correct Answer:

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Access For Free