1. What are the 4 principles of the negotiation strategy described by Roger Fisher and William Ury? Name and describe them briefly. Do you find these principles effective? Explain why. Which of them do you find the most useful and why?
2. A borrow takes out a 7-year interest-only mortgage loan for 500,000 with monthly payments. The first two years of the loan have a “teaser” rate of 2%, after that, the rate can reset annually with 2% annual and 6% lifetime caps. On the first reset date, the fully indexed rate is 5%. What would be the monthly payment in the third loan year?
A because of the increase rate cap, the monthly payment would not change
B 1,667
C 2,083
D 2,500