1. A loan with the following terms is being made: Fixed rate, constant payment 9% interest rate $70,000 desired mortgage amount. $1,500 loan discount points paid by the buyer/borrower to the lender 25-year term, monthly payments a. Calculate the APR for federal truth-in-lending purposes (assume that the discount points are paid up front by the borrow and rolled into the loan principal). b. Do you think that the APR calculated in (a) reflects the likely return that the lender will receive over the term of the loan? List specific reasons that the lender's actual return might be different than the APR.

1. A loan with the following terms is being made: Fixed rate, constant payment 9% interest rate $70,000 desired mortgage amount. $1,500 loan discount points paid by the buyer/borrower to the lender 25-year term, monthly payments a. Calculate the APR for federal truth-in-lending purposes (assume that the discount points are paid up front by the borrow and rolled into the loan principal). b. Do you think that the APR calculated in (a) reflects the likely return that the lender will receive over the term of the loan? List specific reasons that the lender's actual return might be different than the APR.

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

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A loan with a nominal value of ($3000) payable after (250) days. The debtor paid the amount before this period, an amount of ($2300) in repayment of the debt. What is the discount rate at which the debt was deducted if the discount was by the commercial method? 3.84 2.84 5.84 8.84 Find the present value of the loan if you know that the difference between the trade discount and the valid discount is $6, the discount period is 120 days, and the valid interest rate is 5%? 22818 $ 21818 $ 19818 $ O20818 $
56. subject:- accounting
A floating rate mortgage loan is made for $185,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $1,480. Required: a. What will be the loan balance at the end of year 1? b. If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $1,480?
2. Using Excel - Calculate using formulas (paste into a word document) the amortization schedule for a 5-year fixed-rate monthly payment mortgage that is fully amortizing. The interest rate on the loan is 6% and it is a $320,000 loan amount at origination with no points or fees.
asssuming that the interest is the only finance charge, how much interest would be paid on 5,000 installment loan to be repaid in 36 moonthly installment 166.10? what is the apr on this loan?
H3. Show proper step by step calculation
65
The principal P is borrowed and the loan's future value A at time t is given. Determine the loan's simple interest rate r. P = $2300, A = $2722, t = 6 months.
Use the following amortization chart: Selling price of home Down payment Principal (loan) Rate of interest Years Payment per $1,000 Monthly mortgage payment $ 79,000 $ 6,000 $ 73,000 6% 30 $ 5.9955 $ 437.67 Assume the interest rate rises to 7.5%. What is the total cost of interest with the new interest rate? (Use Table 15.1). Note: Round your intermediate calculations and final answer to the nearest cent. Total cost of interest: ????? The answer is NOT $110,753.57 TABLE 15.1 Amortization table (mortgage principal and interest per $1,000) Rate Interest Only 10 Year 15 Year 20 Year 25 Year 30 Year 40 Year 2.000 0.16667 9.20135 6.43509 5.05883 4.23854 3.69619 3.02826 2.125 0.17708 9.25743 6.49281 5.11825 4.29966 3.75902 3.09444 2.250 0.18750 9.31374 6.55085 5.17808 4.36131 3.82246 3.16142 2.375 0.19792 9.37026 6.60921 5.23834 4.42348 3.88653 3.22921 2.500 0.20833 9.42699 6.66789 5.29903 4.48617 3.95121 3.29778 2.625 0.21875 9.48394 6.72689 5.36014 4.54938…
Investigate the effect of the interest rate on simple interest amortized auto loans by finding the monthly payment and the total interest for a four-year loan of $15,000 at the following interest rates. (Round all answers to the nearest cent.) (a) 6.5% payment total interest (b) 6.75% payment total interest (c) 7.0% payment total interest $ 355.72 $ 2054.04 $ 357.46 $2174.04 $ 359.19 $ 2280 (d) 8.0% payment $366.19 total interest $ 2606.04 X X X
f2. Subject :- Accounting Consider a $25,000, three-year loan at an interest rate of 5%, payments to be made monthly. What is the monthly payment using add-on interest?
TASK: 2 are mu pare Apply your understanding about the present value and future value of annuities and prepare TWO Loan EMI (EMI = Equated Monthly Installments) payment schedules based on the following instructions: 1. Loan Summary and schedule of Short term loan (20 marks) 2. Loan Summary and schedule of Long term loan (20 marks) Guidelines: 1. Suggested Short term Loan period is 1 year to 3 years 2. Suggested Long term Loan period is 7 years and above 3. Each loan summary should contains following points: a. What type of loan is chosen? b. Why it is chosen? C. Interest rate, number of years (loan period) and loan amount to be assumed and clearly stated d. Starting date and ending date of the loan period is to be mentioned 4. The payment schedule should cover the following: a. Serial No. b. Date (period) c. EMI amount (EMI = Equated Monthly Installments) d. Principal component of the EMI e. Interest component of the EMI f. Interest paid to date g. Principal paid- to date h. Principal…

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