Tim wants to buy an apartment that costs $750,000 with an 85% LTV mortgage. Tim got a 30 year, 3/1 ARM with an initial teaser rate of 3.75%. The reset margin on the loan is 300 basis points above 1 year CMT. In year 4, the index resets to 3.50%. What will his new mortgage payment be in year 4? (Write the answer as a number rounded to two decimals (e.g. if you get $50,66666, write 50.67).

Tim wants to buy an apartment that costs $750,000 with an 85% LTV mortgage. Tim got a 30 year, 3/1 ARM with an initial teaser rate of 3.75%. The reset margin on the loan is 300 basis points above 1 year CMT. In year 4, the index resets to 3.50%. What will his new mortgage payment be in year 4? (Write the answer as a number rounded to two decimals (e.g. if you get $50,66666, write 50.67).

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

You plan to purchase a $350,000 house using a 15-year mortgage obtained from your bank. The mortgage rate offered to you is 5.50 percent. You will make a down payment of 20 percent of the purchase price. a. Calculate your monthly payments on this mortgage. b. Construct the amortization schedule for the mortgage. How much total interest is paid on this mortgage? (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))
You have decided to buy a house. You can get a mortgage rate of 5.15 percent, and you want your payments to be $1,450 or less. How much can you borrow on a 30-year fixed-rate mortgage? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Mortgage amount
Tim wants to borrow $400,000 from Bank of America on a 30-year mortgage at 6% interest rate. a. What would Tim's monthly payments be on his mortgage? b. Amortize the loan and determine: Interest expense for the first quarter of the loan. Cash flows for the first quarter of the loan. Loan balance at the end of the first quarter of the loan. Please show your calculations, part b is very important. If you are using the TVM chart, please state whether you used PVoA, FVoA, PVoSA, FVoSA.
The Allen's want to purchase a house. They can afford $1,025 a month for 20 years and a $23,000 down payment. They finance the loan with an APR of 5.23% mortgage rate for 20 years. Determine the amount of the Allen's loan using TVM Solver on calculator. N= I%= PV= PMT= FV= P/Y= C/Y=
Suppose that 10 years ago you bought a home for $170,000, paying 10% as a down payment, and financing the rest at 7% interest for 30 years.Your existing mortgage (the one you got 10 years ago)How much money did you pay as your down payment? How much money was your existing mortgage (loan) for? What is your current monthly payment on your existing mortgage?Note: Carry at least 4 decimal places during calculations, but round your final answer to the nearest cent. How much total interest will you pay over the life of the existing loan?
George is looking for a fully amortizing 30 year Fixed Rate Mortgage with monthly payments for $4, 500. He takes a 30 year fixed rate mortgage with 2. 13% interest rate and no fees. Assuming George repays the mortoage after 5 years, what is his annualized IRR on the loan? Write your answer as a percent rounded to two decimal points without the % sign (e.g. if you get 5.6499%, write 5.65).
You decide to purchase a house for $260,000. You have saved money so you are able to do a down payment of $20,000. You are able to finance your house by getting a 25 year mortgage with an interest rate of 7%. What are the monthly payments? (Do not round intermediate calculations and round your final answer to 2 decimal places.) Part 2 - Six years later, you decide to calculate your loan balance? (Use a payment value rounded to 2 decimal places. Round your final answer to 2 decimal places.) (Hint. Use the remaining years for “N”). Part 3 - If the house appreciates at 3.12 percent per year, what will be the value of the house in eight years? (Round your final answer to 2 decimal places.) NOTE: Provide a format and show your work (example: N = 6, PV = XXX, I = X%, etc.)
You plan to purchase a $100,000 house using a 30 year mortgage obtained from your local credit union. The mortgage rate offered to you is 8.25 percent. You will make a downpayment of 20 percent of the purchase price.Calculate the amount of interest and, separately, principal paid in 25th payment. I saw in the internet the answer is: The total 25th payment amount=$601.01N=24pv=80,000i= (8.25%/12)=.6875PMT=601.01FV=78,671.57interest= (.0825/12)x$78,671.57 =$540.86principle= $601.01-540.86= $60.15:is that correct? if yes, where do FV=78,671.57 came from?
Suppose you want to buy a rent to own house worth P450,000. You made a down payment of 15% of the purchase price and take a 25 year mortgage for the balance. a. What is your down payment? b. What is your mortgage amount? c. What is the total interest charged over the life of the loan if your monthly payment is P2,200? Solve manually in a paper.
Suppose you take out a $117,000, 20-year mortgage loan to buy a condo. The interest rate on the loan is 5%. To keep things simple, we will assume you make payments on the loan annually at the end of each year. a. What is your annual payment on the loan? b. Construct a mortgage amortization. c. What fraction of your initial loan payment is interest? d. What fraction of your initial loan payment is amortization? e. What is the total of the loan amount paid off after 10 years (halfway through the life of the loan)? f. If the inflation rate is 3%, what is the real value of the first (year-end) payment? g. If the inflation rate is 3%, what is the real value of the last (year-end) payment? h. Now assume the inflation rate is 6% and the real interest rate on the loan is unchanged. What must be the new nominal interest rate? i-1. Recompute the amortization table. i-2. What is the real value of the first (year-end) payment in this high-inflation scenario? j. What is the real value of the last…
You are a loan officer trying to structure a 5/25 ARM mortgage. The interest rate in the first 5 years is 4.68% per year. From year 6, it will be adjusted annually. Assume in year 6, the prevailing interest rate will be 7.78%. Your client is buying a house for 350,000 and plans to pay 20% of the purchase price down payment. What will the monthly payment in year 6 be?
You are buying a house and the mortgage company offers to let you pay a "point" (1.0% of the total amount of the loan) to reduce your APR from 6.50% to 6.25% on your $400,000, 30-year mortgage with monthly payments. If you plan to be in the house for at least 5 years, should you do it? (Note: Be careful not to round any intermediate steps less than six decimal places.) The monthly mortgage payment at 6.50% APR is $ 2528.27. (Round to the nearest cent.) The monthly mortgage payment at 6.25% APR is $ 2462.87. (Round to the nearest cent.) The lower interest rate on the mortgage results in monthly savings of $ 65.4. (Round to the nearest cent.) The PV of the monthly savings is $ (Round to the nearest cent.)

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS