Chuck Wells is planning to buy a Winnebago motor home. The listed price is $145,000. Chuck can get a secured add-on interest loan from his bank at 7.45% for as long as 60 months if he pays 15% down. Chuck's goal is to keep his payments below $3,400 per month and amortize the loan in 42 months. (a) Find Chuck's monthly payment (in $) with these conditions. (Round your answer to the nearest cent.) $ Can he pay off the loan and keep his payments under $3,400? Yes, under these conditions, Chuck will meet his goal.No, the monthly payment is too high. (b) What are Chuck's options to get his payments closer to his goal? (Select all that apply.) try to bargain for a lower sale price make a higher down payment make a lower down payment try to bargain for a higher sale price try to negotiate a higher interest rate try to negotiate a lower interest rate
Chuck Wells is planning to buy a Winnebago motor home. The listed price is $145,000. Chuck can get a secured add-on interest loan from his bank at 7.45% for as long as 60 months if he pays 15% down. Chuck's goal is to keep his payments below $3,400 per month and amortize the loan in 42 months. (a) Find Chuck's monthly payment (in $) with these conditions. (Round your answer to the nearest cent.) $ Can he pay off the loan and keep his payments under $3,400? Yes, under these conditions, Chuck will meet his goal.No, the monthly payment is too high. (b) What are Chuck's options to get his payments closer to his goal? (Select all that apply.) try to bargain for a lower sale price make a higher down payment make a lower down payment try to bargain for a higher sale price try to negotiate a higher interest rate try to negotiate a lower interest rate
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Chuck Wells is planning to buy a Winnebago motor home. The listed price is $145,000. Chuck can get a secured add-on interest loan from his bank at 7.45% for as long as 60 months if he pays 15% down. Chuck's goal is to keep his payments below $3,400 per month and amortize the loan in 42 months.
(a)
Find Chuck's monthly payment (in $) with these conditions. (Round your answer to the nearest cent.)
$
Can he pay off the loan and keep his payments under $3,400?
Yes, under these conditions, Chuck will meet his goal.No, the monthly payment is too high.
(b)
What are Chuck's options to get his payments closer to his goal? (Select all that apply.)
try to bargain for a lower sale price
make a higher down payment
make a lower down payment
try to bargain for a higher sale price
try to negotiate a higher interest rate
try to negotiate a lower interest rate
(c)
Chuck spoke with his bank's loan officer, who has agreed to finance the deal with a 6.85% loan if Chuck can pay 20% down. What will Chuck's new monthly payment (in $) be with these conditions? (Round your answer to the nearest cent.)
$
With these conditions, will Chuck be able to pay off the loan and meet his goals?
1. Yes, under these conditions, Chuck will meet his goal.
2. No, the monthly payment is too high.
(d)
Attempting to reduce his monthly payment further, Chuck continues to negotiate with the seller. If the seller agrees to reduce the listed price by $4,600, finance the deal with a 6.85% loan, and if Chuck pays the 20% down, what will Chuck's monthly payment be (in $)? (Round your answer to the nearest cent.)
$
With these conditions, will Chuck be able to pay off the loan and meet his goal?
Yes, under these conditions, Chuck will meet his goal.
No, the monthly payment is too high.
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