Contemporary Mathematics for Business and Consumers 7th Edition by Robert Brechner ,George Bergeman

Exercise 19

As one of the loan officers for Grove Gate Bank, calculate the monthly principal and interest, PI, using Table 14-1 and the monthly PITI for the following mortgages.
Luis Schambach is shopping for a 15-year mortgage for $150,000. Currently, the Fortune Bank is offering an 8.5% mortgage with 4 discount points and the Northern Trust Bank is offering an 8.75% mortgage with no points. Luis is unsure which mortgage is a better deal and has asked you to help him decide. (Remember, each discount point is equal to 1% of the amount financed.)
a. What is the total interest paid on each loan?
b. Taking into account the closing points, which bank is offering a better deal and by how much?