Question

You have purchased a small medical office building in Hoboken for $3,500,000 and financed the acquisition by borrowing $2,500,000 in the form of a 5-year mortgage with a 30-year amortization period. If the loan has an 8% interest rate and payments are made on an annual basis, what is the mortgage interest deduction you receive in the first year

Answer 1

$200,000

Step-by-step explanation:

Interest calculation is based on the Principle amount of $2,500,000 borrowed .