You plan on borrowing $320,000 for a mortgage and are considering the following two loan options: a 15-year loan with an APR of 2.9% and a 30-year loan with an APR of 3.5% Calculate the monthly payments for both loans Calculate the total interest paid for both loans Which loan would you be most likely to take? Why?

Q: You are considering the purchase of a condominium to use as a rental property. You estimate that you…

A: Monthly rent = $1300 Monthly costs = $300 r = 6% per annum = 0.5% per month n = 25 years = 300…

Q: You plan to purchase a house for $ 400,000 and you will make a 20% down payment. You are evaluating…

A: The mortgage is taken to purchase or maintain real estate. The borrower pays the lender regular…

Q: Suppose your gross monthly income is $5,500 and your current monthly payments are $575. If the bank…

A: Maximum monthly payment = (Gross monthly income *Allowable % for monthly payments)- Current monthly…

Q: 1. Suppose you are planning to avail of a housing loan. You are considering the options given below.…

A: Amount to be borrowed (B) = Php 2000000 Option A interest rate (r) = 6% per annum = 0.5% per month…

Q: You are purchasing a house and you are considering getting a fixed-rate mortgage (FRM) for $750,000.…

A: Required monthly payments for the mortgage is calculated using excel PMT function Required monthly…

Q: An individual wishes to borrow $10,000 for a year and is offered the following alternatives: a. A 10…

A: Calculating the effective interest rate on borrowing option 10% loan discounted in advances. We…

Q: You plan to purchase a $390,000 house using either a 30-year mortgage obtained from your local…

A: The question is based on the concept of Financial Management.

Q: Dan is considering borrowing $489,000 to purchase a new condo. Based on that information, answer the…

A: The question is based on the concept of the mortgage loan. A mortgage loan is a secured loan, which…

Q: uliana is taking out an $8,700, 3-year loan with an APR of 2.31%. What will be the monthly payment…

A: In this question we need to calculate the monthly payment for the loan .

Q: Suppose you purchase a house using a 30-year fixed rate mortgage. The APR on the loan is 3.2% and…

A: The current price of the house is computed by computing the present worth of the house. The formula…

Q: You have just purchased a new warehouse. To finance the purchase, you have arranged for a 30-year…

A: The calculation is:

Q: Consider the following pairs of choices for a $120,000 mortgage loan. Calculate the monthly payment…

A: PMT Excel function is used to determine the amount of the equal period payment. Closing cost is…

Q: You plan to purchase a house for $115,000 using a 30-year mortgage obtained from your local bank.…

A: Discount points refer to the optional fees (extra charges) over the agreed stated interest rate on a…

Q: Your friends suggest that you take a 15-year mortgage, because a 30-year mortgage is too long and…

A: Installment is the amount of periodic payments a borrower has to make to its lender in order to pay…

Q: You have a choice between a 30-year fixed rate loan at 6.5% and an adjustable rate mortgage (ARM)…

A: EMI or monthly or annual mortgage payments are the fixed amount paid by the borrower to the lender…

Q: If you are planning to apply for a personal loan and borrow PhP 50,000 and repay the principal and…

A: A study that proves that the 1value of money today is higher than the future value of money is term…

Q: Suppose you take out a 30-year mortgage of $100,000 with a fixed interest rate of 5 percent. You…

A: given, p = $100,000 r = 5% m = 12 n = 30

Q: You plan to buy a $300,000 home with a 20% down payment. The bank suggests two options: a 15-year…

A: Introduction: Mortgage: A mortgage is a loan from a bank or a mortgage lender that helps a person to…

Q: You are planning to take out a 5 hundred thousand dollar fixed-rate mortgage with a 30-year term and…

A: In this question the loan of offered at a discount of 3 points which means 3% discount.

Q: You need a 30-year, fixed-rate mortgage to buy a new home for $240,000. Your mortgage bank will lend…

A: Given, New home $240,000 Money at an APR of 3.25 percent for 360 month loan Balloon monthly payments…

Q: If your bank approves a $300,000 mortgage for your new home, at an annual percentage rate of 4.5%…

A: Loan amount = $ 300,000 Interest rate = 4.5% Monthly interest rate = 4.5%/12 = 0.375% Monthly…

Q: You’ve decided to buy a house that is valued at $1 million. You have $250,000 to use as a down…

A: The question is based on the concept of amortization of loan in equal periodic installment.by…

Q: maximum loan

A: Loan amount refers to the amounts which a person borrowed at any given time under the mortgage. It…

Q: You are ready to buy a house and you have $35,000 for a down payment and closing costs. Closing…

A: Excel formula.

Q: You have just purchased a new warehouse. To finance the purchase, you’ve arranged for a 30-year…

A: Annual Percentage Rate (APR) refers to the percentage rate which shows the interest rate…

Q: A borrower is making a choice between a mortgage with monthly payments or biweekly payments. The…

A: a) Calculate the monthly payment as shown below: Hence, the value of the monthly payment is…

Q: Dan is considering borrowing $500,000 to purchase a new condo. Based on that information, answer the…

A: In order to manage the finance effectively, the business entity raises the funds from external…

Q: Suppose you purchase a home and obtain a 30-year fixed-rate loan of $145,000 at an annual interest…

A: Time Period = 30 years*12 = 360 months Loan Amount = 145,000 Interest% = 7.5%/12 = 0.625%

Q: Suppose you have budgeted $ 950 a month towards a mortgage. If you are offered a 30 year mortgage at…

A: Present value of annuity formula is applicable to find the mortgage loan amount for given mortgage…

Q: Suppose your gross monthly income is $5,600 and your current monthly payments are $525. If the bank…

A: Step 1: The calculation is:

Q: If you are planning to apply for a personal loan and borrow PhP 30,000 and repay the principal and…

A: The question is based on the concept of loan repayment by the use of amortization of funds. The loan…

Q: Consider the following options for a $153,000 mortgage. Calculate the monthly payment and total…

A: Data given: Mortgage = $153,000 Option 1: N= 30 years Rate = 4.3% Closing cost  = $1500 and no point…

Q: You decide to purchase a building for $30,000 by paying $5,000 down and assuming a mortgage of…

A: The annual percentage rate (APR): It is the total interest expressed as percentage paid on an loan.

Q: You purchase a home costing $480,000 with a 20% down payment. After shopping around for a mortgage,…

A: Thus, Monthly Payment in option 1 is $1583.32 and in Option 2 is $1586.07

Q: a. The bank offers a 30​-year mortgage with fixed monthly payments and an interest rate of 0.53% per…

A: Given information :- Loan amount = $620,000 Time period =  30 years or 360 months  Monthly interest…

Q: You need a 30-year, fixed-rate mortgage to buy a new home for $400,000. Your mortgage bank will lend…

A:

Q: You plan to purchase a house for $ 400,000 and you will make a 20% down payment. You are evaluating…

A: Price of house $400,000 Down payment [$400,000*20%] $80,000 Loan amount or PV of loan $320,000…

Q: ou have a 30-year mortgage loan for $250,000 with an interest rate of 6% which requires you to make…

A: This pertains to time value of money.  The concept of time value of money tells us that worth of…

Q: Suppose you have budgeted $ 950 a month towards a mortgage. If you are offered a 15-year mortgage at…

A: A= $950 m=12 n=15 year r=6.25%

Q: You can obtain a loan of $200000 at a rate of 15 percent for two years. You have a choice of (i)…

A: Loan amount  $ 2,00,000.00 Time Period 2 Interest Rate 15%

Q: When purchasing a $100,000 house, a borrower is comparing two loan alternatives. The first loan is…

A:

Q: You want to buy a house that has a purchase price of $160,000. You plan to make a down payment of…

A: Down payment refers to a small percentage of the total purchase price paid by the buyer. A down…

Q: Suppose that you're planning a vacation and borrow $2,000 from a bank for one year at a stated…

A: The real interest that an investor earns on the investment and a borrower pays on loan after…

Q: Oppenheimer Bank is offering a 30-year mortgage with an EAR of 5 3/8%. If you plan to borrow…

A: A mortgage is taken to purchase or maintain real estate. The borrower pays the lender regular…

Loans

A loan is a term that we are all familiar with. The processing of loans is one of the most important functions of a bank. It keeps our economy stable and facilitates the implementation of monetary policies. Let's take a look at the different forms of loans and get some answers to some common questions.