You want to buy a house that costs $210,000. You have $21,000 for a down payment, but your credit is such that mortgage companies will not lend you the required $189,000. However, the realtor persuades the seller to take a $189,000 mortgage (called a seller take-back mortgage) at a rate of 5%, provided the loan is paid off in full in 3 years. You expect to inherit $210,000 in 3 years, but right now all you have is $21,000, and you can afford to make payments of no more than $22,000 per year given your salary. (The loan would call for monthly payments, but assume end-of-year annual payments to simplify things.)
What would the loan balance be at the end of Year 3? Do not round intermediate calculations. Round your answer to the nearest cent.
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