saikrishna123 wrote:
How come repayment amount ( SUM OF ALL PAYMENTS) is 1n?? Explanation very confusing. Can anyone help?
If you check the actual meaning of loan proceeds, then u can understand the answer
Loan proceeds: The net amount of money that a lender disburses for a loan.
Example: A borrower agreed to a $100,000 mortgage loan. The lender charged 1% for origination and a 1% discount, providing $98,000 of loan proceeds.
Here 80% of collateral or loan amount = n or 1n
discount = .15n (15% of loan amount)
so
...
