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5e. Suppose you are willing to continue making monthly payments of $1402, and want to pay off the mortgage in 25 years. How much additional cash can you borrow today as part of the refinancing?
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- 5d. If you still want to pay off the mortgage in 25 years, what monthly payment should you make after you refinance? 5e. Suppose you are willing to continue making monthly payments of $1402, and want to pay off the mortgage in 25 years. How much additional cash can you borrow today as part of the refinancing?3. Suppose you decide to purchase a $150000 home for $20000 down. A down payment is subtracted from your home’s value and therefore you owe $130000. Well to pay for this amount you will need a loan, so $130000 is the principal on your loan. Suppose the interest rate on a 30 year mortgage is 4.5%. What will your monthly payment be? Create an amortization table for this loan. How much will you pay on the loan if you pay off the loan asSuppose 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…
- 3. Suppose we need to borrow $150,000 at an APR of 6% to buy a new house. a. What will be the monthly payment if we borrow the money for 15 years? b. How much interest will we have paid by the end of the loan? c. What is the monthly payment if you were to borrow the money for 25 years? With that being said, how much interest will you have paid at the end of the 25 year loan?B. 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.b) Suppose you begin saving for your retirement by depositing $2,000 per year in an IRA. If the interest rate is 7.5%, how much will you have in 40 years if the payments are made: at the end of the year (ordinary annuity)? at the beginning of the year (annuity due)?
- 1.What is the amount a person would have to deposit today (present value) at 11 percent interest rate to have $8500 saved 9 years from now. 2.What is the amount you would have to deposit today to be able to take out $2070 a year for 2 years from an account earning 14 percent. 3.If you desire to have $38300 for a down payment for a house in 11 years, what amount would you need to deposit today? Assume that your money will earn 4 percent.4. You are purchasing a house for $310,000. You plan to take out a 25-year loan to pay for the house.a. What will your monthly payments be if the interest rate is 5%?b. What will your monthly payments be if the interest rate is 6%2. You finance a house purchase with a 20-year mortgage with an effective annual interest rate of 6%. Your first mortgage payment is $30,000 immediately, and subsequent payments decrease by $1,000 each year. What is the purchase value of the house?
- 19. You borrow $1,500,000 to purchase a small apartment building. The lender charges you a 2% up-front fee. If the loan term is 30 years and the interest rate is 5%, what is the mortgage balance at the end of year 5?6. You purchase a house for $250,000 by getting a mortgage for $200,000 and paying a $50,000 down payment (20%). You can get a 30 year mortgage with a 3.0% interest rate.What would be your monthly payment? ________2. (From section 6.2) You want to be able to withdraw $50,100 from your account each year for 20 years after you retire. You expect to retire in 35 years. If your investment account earns 5.5% interest, how much will you need to deposit into the account at the end of each year until you reach retirement to achieve your retirement goals? (a) The first part is finding how much we need to have in the account by the time we retire. Which formula will you use first? Circle one. Annuity Payout-Annuity (b) What are the following variables that we will need for the formula? PMT = n = t = r = A or Po = (c) Write the formula you will use with the numbers plugged in below. (d) Solve using your calculator or technology and round to two decimal places. Work is not required here. Write the answer here and state which variable you solved for. (e) Using your own words, describe what you found by solving the equation in terms of the word problem given.