Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN: 9780357033609
Author: Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher: Cengage Learning
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Chapter 6, Problem 12FPE
Summary Introduction
To discuss: The steps to be taken by Person C to improve the FICO score.
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Can Olivia and Anthony Afford This Home Using the Monthly Income Loan Criterion?
Next week, your friends Olivia and Anthony want to apply to the Fourth Global Bank for a mortgage loan. They are considering the purchase of a home that is expected to cost $125,000. Given your knowledge of personal finance, they’ve asked for your help in completing the Home Affordability Worksheet that follows. (Note: When completing the form, round each dollar amount to the nearest whole dollar.)
To assist in the preparation of the worksheet, Olivia and Anthony also collected the following information:
•
Their financial records report a combined gross before-tax annual income of $125,000 and current (premortgage) installment loan, credit card, and car loan debt of $1,823 per month.
•
Their property taxes and homeowner’s insurance policy are expected to cost $3,125 per year.
•
Their best estimate of the interest rate on their mortgage is 7.5%, and they are interested in obtaining a 15-year loan.…
Read the passage and answer the following
question(s).
dis
ins
Homeowner and Renters Insurance: Protect Your Belongings
You may be able to save hundreds of dollars a year on
homeowners insurance by shopping around. You can also
save money with these tips:
Consider a higher deductible. Increasing your deductible by
just a few hundred dollars can make a big difference in your
premium.
Ask your insurance agent about discourks. You may be able
to get a lower premium if your home has safety features
such as dead-bolt locks, smoke detectors, an alarm system,
storm shutters or fire retardant roofing material. Persons
over 55 years of age or long-term customers may also be
offered discounts.
OD.
Insure your house NOT the land under it. After a disaster,
the land is still there. If you don't subtract the value of the
land when deciding how much homeowners insurance to
buy, you will pay more than you should.
Don't wait till vou have lor
Please help solve this in Excel and please show all the steps and formulas to solve this step by step in Excel.
Please use the following information to answer a. through f. Five years ago, Nick purchased a house of $500,000. Nick borrows a mortgage with 80% of LTV (loan to value ratio), monthly payments and the interest rate of 5% for 30 years. Nick found a new lender who will refinance the current outstanding loan balance plus all the costs associated with the new loan at 3.5% with monthly payments for 30 years. Suppose that the new lender will charge 3.5 discount points on the new loan and other refinancing costs will equal $2,000.
a. What is the monthly payment for the current loan?
b. What is the current outstanding loan balance?
c. What is the new loan amount if Nick chooses to refinance?
d. What is Nick's monthly payment for the new loan?
e. What is the effective cost of the new loan if Nick holds the loan for 30 years? Should Nick refinance?
f. If Nick wants to refinance today,…
Chapter 6 Solutions
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
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Pfin (with Mindtap, 1 Term Printed Access Card) (...FinanceISBN:9780357033609Author:Randall Billingsley, Lawrence J. Gitman, Michael D. JoehnkPublisher:Cengage Learning
Pfin (with Mindtap, 1 Term Printed Access Card) (...
Finance
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Cengage Learning