Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Transcribed Image Text:Your new 30-year mortgage includes borrowing $425,000 at an APR of 4.78%. If you paid 20% down when you bought this house, and if the value of the property grows at about 3.0% a year, how much
will you have to invest if you seel the house after 14 years? (Ignore here any taxes or fees on the purchase or sale of the house.)
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- Your have just sold your house for $1,000,000 in cash. Your mortgage was originally a 30-year mortgage with monthly payments and an initial balance of $800,000. The mortgage is currently exactly 18.50 years old, and you have just made a payment. If the interest rate on the mortgage is 5.25% (APR), how much cash will you have from the sale once you pay off the mortgage? (Ignore any real estate transaction costs.) .…. The discount rate is % per month. The monthly mortgage payment is $ The remaining balance is $ (Round to the nearest dollar.) The cash that remains after payoff of the mortgage is $ (Round to five decimal places.) (Round to the nearest cent.) (Round to the nearest dollar.)arrow_forwardYou want to buy a house that costs $290,000. You will make a down payment equal to 10 percent of the price of the house and finance the remainder with a loan that has an APR of 5.51 percent compounded monthly. If the loan is for 20 years, what are your monthly mortgage payments? Group of answer choices $1,736.96 $1,886.70 $1,821.54 $1,796.86 $1,788.65arrow_forwardYou have just sold your house for $950,000 in cash. Your mortgage was originally a 30-year mortgage with monthly payments and an initial balance of $740,000. The mortgage is currently exactly 18.5 years old, and you have just made a payment. If the interest rate on the mortgage is 6.75% (APR), how much cash will you have from the sale once you pay off the mortgage? (Note: Be careful not to round any intermediate steps less than six decimal places.) Cash that remains after payoff of mortgage is $ (Round to the nearest cent.)arrow_forward
- Subject: Financearrow_forwardSuppose you want to purchase a home for $525,000 with a 30-year mortgage at 4.84% interest. Suppose also that you can put down 30%. What are the monthly payments? (Round your answer to the nearest cent.) $ What is the total amount paid for principal and interest? (Round your answer to the nearest cent.) $ What is the amount saved if this home is financed for 15 years instead of for 30 years? (Round your answer to the nearest cent.)arrow_forwardNonearrow_forward
- If you buy a home with less than 20% down, you will pay an additional monthly fee, PMI (private mortgage insurance), until you reach 20% equity. Keep track of when you reach 20% equity so you can request to have your PMI removed. Ken Buckmiller’s home recently appraised at $307,000. His mortgage was for $292,000 at 5% for 30 years with PMI of $299.17 per month. What is his monthly payment plus PMI? His mortgage balance is currently $184,200. Has he reached 20% equity? (Use Table 15.1.) Note: Round your intermediate calculations and final answer to the nearest cent. The answer is NOT $1,866.63 Monthly payment:????arrow_forward(Loan amortization) To buy a new house, you must borrow $135,000. To do this, you take out a $135,000, 25-year, 9 percent mortgage. Your mortgage payments, which are made at the end of each year (one payment each year), include both principal and 9 percent interest on the declining balance. How large will your annual payments be? The amount of your annual payments will be $ (Round to the nearest cent.)arrow_forwardYou just closed on a $384,757 home in Cincinnati, Ohio. Now you have a 30-year mortgage with an APR of 11.75 percent per year with monthly compounding. How much interest will you pay over the life of the mortgage? $1,013,401.86 $384,757.00 $1,398,158.86 O $15,890,464.10 O $61,141.15arrow_forward
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