Mortgage. You are arranging a $350,000 Canadian mortgage with a 25-year amortization period and a 7% posted interest rate. What is the monthly mortgage payment? Suppose the bank offers you the opportunity to pay your monthly payments in two equal instalments (pay one-half of the monthly payment every 2 weeks). How much faster will you pay off your mortgage this way? (

Mortgage. You are arranging a $350,000 Canadian mortgage with a 25-year amortization period and a 7% posted interest rate. What is the monthly mortgage payment? Suppose the bank offers you the opportunity to pay your monthly payments in two equal instalments (pay one-half of the monthly payment every 2 weeks). How much faster will you pay off your mortgage this way? (

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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Suppose you decide to borrow $330,000 of cash to purchase a house and take out a 20-year fixed rate mortgage that has a quoted rate of 8% per year. (Please keep a large number of digits in the calculations below. In particular it is important to have your answers correct to the dollar.) a) What is the size of your monthly payment? b) Suppose that just after making your 60th monthly payment, mortgage rates are quoted at 6% per year for both 10-year and 30-year mortgages. Suppose you decide to refinance using a 30-year mortgage. What is your gain from refinancing (ignoring transactions costs)?
A $230,000 mortgage has a stated annual rate of 4.5% on a 30 year loan. Approximately how many payments would it take to pay off the loan if you made payments of $2000 each month? (NOTE: don't forget to "undo" to get your formula back into the payment amount in your table after changing for this question!)
You have just purchased a home and taken out a $550,000 mortgage. The mortgage has a 30-year term with monthly payments and an annual percentage rate (APR) (with semi-annual compounding) of 6.80%. (Note: Be careful not to round any intermediate steps less than six decimal places.) a. How much will you pay in interest, and how much will you pay in principal, during the first year? b. How much will you pay in interest, and how much will you pay in principal, during the twentieth year (i.e., between 19 and 20 years from now)? a. How much will you pay in interest, and how much will you pay in principal, during the first year? During the first year, you will pay an interest payment of $ (Round to the nearest dollar.) During the first year, you will pay a principal payment of $ (Round to the nearest dollar.)
If you could pay for your mortgage forever, how much would you have to pay per month for a $1,000,000 mortgage, at a 6.5% annual interest rate? Work out the answer (a) if the 6.5% is a bank APR quote and (b) if the 6.5% is a true effective annual rate of return.
How much will the monthly mortgage payment be if you purchase a new condominium for $150 000 with an interest rate of 4%/a compounded monthly? The mortgage amortization period is 25 years (there is a 5% down payment that should be paid upfront)?
Suppose that four years ago you took out a Canadian mortgage for $683,000at an APR of 3.37% with monthly payments to be amortized over 25 years. You have been paying$3363.32 per month. Today, you have the opportunity to refinance your mortgage at 1.98% for your monthly payments for the remaining 21 years. (a) Calculate the e§ective monthly interest rate and the remaining balance of the loan outstanding when 21 years remain to the loan. (b) Find the new e§ective monthly interest rate if you decide to refinance at 1.98%. How much would your new monthly payment be?
← You have just negotiated a home mortgage with a principal of $350,000. The bank's quoted rate is 6.3%. You chose a 20-year amortization and you decide to make 12 payments per year. Each mortgage payment is $2,551.90. How much interest do you pay in the first year? Express your answer as a percentage of the total value of your mortgage payments in the first year. The interest as a percentage of the total payments in year 1 is %. (Round to four decimal places as needed.)
You want to get a commercial real estate mortgage of $6875599. You are offered a monthly payment loan with 5.75% interest and a 25 year amortization schedule with a balloon payment at the end of 7 years. What will be your monthly mortgage payment? State your answer as a number rounded to two decimal points
<. Question 18 You can afford a $1200 per month mortgage payment. You've found a 30 year loan at 6% interest. a) How big of a loan can you afford? tor b) How much total money will you pay the loan company? c) How much of that money is interest? Calculator
1. You have been approved for a mortgage for a property. The mortgage is for a 20-year period with a 7.2% annual interest rate for a total amount of $1,700,000 What is the annual payment if payments are made annually What would you put in your annual cash flow if you were paying the mortgage on a monthly basis? What will be the interest and principal payments for the second and third years of the mortgage? What will be the remaining principal balance at the end of the fifth year? Answer question using excel formulas
Suppose you are interested in taking an FHA mortgage loan for $250,000 in order to purchase your principal residence. In order to do so, you must pay an additional up-front mortgage insurance premium (UFMIP) of 1.0% of the mortgage balance. If the interest rate on the fully-amortizing mortgage loan is 5% and the term is 30 years and the UFMIP is financed (i.e., it is included in the loan amount), what is the dollar portion of your monthly mortgage payment that is designated to cover the UFMIP? A. $2,500.00B. $1,119.41C. $159.67D. $13.42
A borrower is making a choice between a mortgage with monthly payments or biweekly payments. The loan will be $238,000 at 6 percent interest for 20 years. Required: a. hat would be the maturity period if payments are bi-weekly? How much will the borrower pay in total under each payment option? Which choice would be less costly to the borrower? Hint: Assume 26 total bi-weekly payments per year for the maturity period. b. Assume that the bi-weekly loan was available for 5.75%. What would be the maturity period if payments are bi-weekly? How much will the borrower pay in total under each payment option? Which choice would be less costly for the borrower? Complete this question by entering your answers in the tabs below. Required A Required B hat would be the maturity period if payments are bi-weekly? How much will the borrower pay in total option? Which choice would be less costly to the borrower? Hint: Assume 26 total bi-weekly payments maturity period. Note: (Do not round intermediate…

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