REFINANCING A HOME Josh purchased a condominium 5 years ago for $ 180 , 000 . He made a down payment of 20 % and financed the balance with a 30 -year conventional mortgage to be amortized through monthly payments with an interest rate of 4% / year compounded monthly on the unpaid balance. The condominium is now appraised at $ 250 , 000 . Josh plans to start his own business and wishes to tap into the equity that he has in the condominium. If Josh can secure a new 30-year conventional mortgage at the same rate to refinance his condominium based on a loan of 80 % of the appraised value, how much cash can Josh muster for his business? (Disregard taxes.)
REFINANCING A HOME Josh purchased a condominium 5 years ago for $ 180 , 000 . He made a down payment of 20 % and financed the balance with a 30 -year conventional mortgage to be amortized through monthly payments with an interest rate of 4% / year compounded monthly on the unpaid balance. The condominium is now appraised at $ 250 , 000 . Josh plans to start his own business and wishes to tap into the equity that he has in the condominium. If Josh can secure a new 30-year conventional mortgage at the same rate to refinance his condominium based on a loan of 80 % of the appraised value, how much cash can Josh muster for his business? (Disregard taxes.)
Solution Summary: The author explains how Josh can muster 69,755.71 for his business.
REFINANCING A HOME Josh purchased a condominium
5
years ago for
$
180
,
000
. He made a down payment of
20
%
and financed the balance with a
30
-year conventional mortgage to be amortized through monthly payments with an interest rate of
4%
/
year
compounded monthly on the unpaid balance. The condominium is now appraised at
$
250
,
000
. Josh plans to start his own business and wishes to tap into the equity that he has in the condominium. If Josh can secure a new 30-year conventional mortgage at the same rate to refinance his condominium based on a loan of
80
%
of the appraised value, how much cash can Josh muster for his business? (Disregard taxes.)
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