A borrower procures a package of 3 loans to finance an acquisition. Loan A: 150,000 30-years 6% Loan B: 100,000 20-years 5% Loan C: 50,000 10-years 4% Assuming no points, what is the effective interest rate for this loan package?
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A. 4.75%
B. 5.14%
C. 5.54%
D. 6.02%
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- A loan is to be amortized by n level annual payments of X where n > 5. You are given (1) The amount of interest in the first payment is 604.00 (2) The amount of interest in the third payment is 593.75 (3) The amount of interest in the fifth payment is 582.45 Calculate X.Suppose a homeowner has an existing mortgage loan with these terms: Remaining balance of $150,000, interest rate of 8 percent, and remaining term of 10 years (monthly payments). This loan can be replaced by a loan at an interest rate of 6 percent, at a cost of 8 percent of the outstanding loan amount. Required: a. What is the net benefit of refinancing? Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places. b. What is the NPV if the homeowner expects to be in the home for only five more years? Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places. a. Net benefit of refinancing b. NPV $ + 6,552.77 1,819.91In a discount interest loan, you pay the interest payment up front. For example, if a 1-year loan is stated as $42,000 and the interest rate is 8.50%, the borrower “pays” 0.0850 × $42,000 = $3,570 immediately, thereby receiving net funds of $38,430 and repaying $42,000 in a year. a. What is the effective interest rate on this loan? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) b. What is the effective annual rate on a 1-year loan with an interest rate quoted on a discount basis of 18.50%? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
- You have taken out a $7,500,000 loan with a 4% interest rate, 30 year amortization and ten year term. What is the loan balance after the final loan payment? a. $0 b. $7,390,303 c. Cannot determine with information provided d. $5,908,797Find the payment necessary to amortize a 5.5% loan of $7700 compounded semiannually, with 6 semiannual payments. Find (a) the payment necessary to amortize the loan and (b) the total payments and the total amount of interest paid based on the calculated semiannual payments. Then create an amortization table to find (C) the total payments and total amount of interest paid based upon the amortization table. a. The semiannual payment needed to amortize this loan is $ (Round to the nearest cent as needed.) b. The total amount of the payments is $ (Round to the nearest cent as needed.) The total amount of interest paid is $ (Round to the nearest cent as needed.) c. The total payment for this loan from the amortization table is $ %24 The total interest from the amortization table is $the intereswt rate a company pays on 1 - year, 5-year loan depends on?
- The principal P is borrowed and the loan's future value A at time t is given. Determine the loan's simple interest rate r. P = $2300, A = $2722, t = 6 months.1. A loan with the following terms is being made: Fixed rate, constant payment 9% interest rate $70,000 desired mortgage amount. $1,500 loan discount points paid by the buyer/borrower to the lender 25-year term, monthly payments a. Calculate the APR for federal truth-in-lending purposes (assume that the discount points are paid up front by the borrow and rolled into the loan principal). b. Do you think that the APR calculated in (a) reflects the likely return that the lender will receive over the term of the loan? List specific reasons that the lender's actual return might be different than the APR.Find the total installment cost and the finance charge for an installment loan with these conditions. Amount financed: $3000 Down payment: $500 Cash price: $3500 Number of Payments: 12 Amount of Payment: $275 What is the total installment cost? What is the finanace charge?
- 3. Find the payment necessary to amortize the following loans using the amortization table, and round to the nearest cent if needed. Amount of Loan: $12000 Interest Rate: 6% Payments Made: semiannually Number of Years: 8DCR: a. Calculate the DCR for an income producing property to be acquired at a price of $7M and a CAP of 5.5%. The down payment on the property is 30% of the property value and the mortgage on the remaining balance is a fixed-rate interest only loan at a rate of 4%. b. What is the meaning of a DCR of 1.40, for example? Please explain. c. List and briefly explain three different factors that are likely to cause the lender to require a higher DCR from investors?(Q) A borrower takes out a 5/1 Hybrid ARM for $600,000 with an initial contract interest rate of 5.5%. The interest rate will adjust according to the 1-year LIBOR rate, plus a margin of 2%. At the first reset date, 1-year LIBOR is at 5.5%. What will the borrowers' monthly payment be immediately after the first reset? (State the payment as a positive number. Unless otherwise stated, you can assume 5/1 ARMs have a term of 30 years. Round your answer to 2 decimal places.)