Five years ago you took out a 5/1 adjustable rate mortgage and the five-year fixed rate period has just expired. The loan was originally for $308,000 with 360 payments at 4.1% APR, compounded monthly. a. Now that you have made 60 payments, what is the remaining balance on the loan? b. If the interest rate increases by 1.2%, to 5.3% APR, compounded monthly, what will be your new payments? a. Now that you have made 60 payments, what is the remaining balance on the loan? The remaining balance on the loan is $42010.68. (Round to the nearest cent.) b. If the interest rate increases by 1.2%, to 5.3% APR, compounded monthly, what will be your new payments? The new payment is $nothing.
Five years ago you took out a 5/1 adjustable rate mortgage and the five-year fixed rate period has just expired. The loan was originally for $308,000 with 360 payments at 4.1% APR, compounded monthly. a. Now that you have made 60 payments, what is the remaining balance on the loan? b. If the interest rate increases by 1.2%, to 5.3% APR, compounded monthly, what will be your new payments? a. Now that you have made 60 payments, what is the remaining balance on the loan? The remaining balance on the loan is $42010.68. (Round to the nearest cent.) b. If the interest rate increases by 1.2%, to 5.3% APR, compounded monthly, what will be your new payments? The new payment is $nothing.
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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Concept explainers
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
Question
Five years ago you took out a 5/1 adjustable rate mortgage and the five-year fixed rate period has just expired. The loan was originally for
$308,000
with
360
payments at
4.1%
APR, compounded monthly.a. Now that you have made
60
payments, what is the remaining balance on the loan?b. If the interest rate increases by
1.2%,
to
5.3%
APR, compounded monthly, what will be your new payments?a. Now that you have made
60
payments, what is the remaining balance on the loan?The remaining balance on the loan is
$42010.68.
(Round to the nearest cent.)b. If the interest rate increases by
1.2%,
to
5.3%
APR, compounded monthly, what will be your new payments?The new payment is
$nothing.
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