Ms. Madison has an existing loan with payments of $782.34. The interest rate on the loan is 10.5% and the remaining loan term is 10 years. The current balance of the loan is $57,978.99. The home is now worth $120,000 and Ms. Madison would like to borrow an additional $30,000 through a wraparound loan which would increase the debt to 87,978.99. Terms of the wraparound loan are 12.25% interest with monthly payments for 10 years. What is the incremental cost of borrowing the extra $30,000 through a wraparound loan? 13.41% 11.38% 12.96% 15.47%

Ms. Madison has an existing loan with payments of $782.34. The interest rate on the loan is 10.5% and the remaining loan term is 10 years. The current balance of the loan is $57,978.99. The home is now worth $120,000 and Ms. Madison would like to borrow an additional $30,000 through a wraparound loan which would increase the debt to 87,978.99. Terms of the wraparound loan are 12.25% interest with monthly payments for 10 years. What is the incremental cost of borrowing the extra $30,000 through a wraparound loan? 13.41% 11.38% 12.96% 15.47%

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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Anna is buying a house selling for $285,000. To obtain the mortgage, Anna is required to make a 10% down pa Anna obtains a 30-year mortgage with an interest rate of 4%. Click the icon to view the table of monthly payments. a) Determine the amount of the required down payment b) Determine the amount of the mortgage. c) Determine the monthly payment for principal and interest. a) Determine the amount of the required down payment. CO
Noor is buying a home with a $200,000 mortgage using a 5.5 percent, 30-year loan. How much of the first month's payment will go toward the principal if the payment per $1000 on this loan is $5.6779? O a. $917 O b. $219 O c. $0 O d. $538
Kari is purchasing a home for $220,000. The down payment is 25% and the balance will be financed with a 15 year mortgage at 8% and 3 discount points. Kari made a deposit of $30,000 (applied to the down payment) when the sales contract was signed. Kari also has these expenses: credit report, $70; appraisal fee, $120; title insurance premium, 1% of amount financed; title search, $200; and attorney's fees, $500. Find the closing costs (in $).
Asma has borrowed $1,000,000 from MQ Bank for 10 years at an interest rate of j2=4.67% p.a. She will make 10 annual repayments. According to the loan agreement, Asma's repayments will be $83,000 for the first two years followed by payments of X per year for the remaining eight years. This loan needs to be fully repaid by the end of 10 years. (b) Assume that all annual repayments will be paid at the beginning of each year (the first payment will be at the start of the first year), what is the value of Asma's annual payment amount, X (rounded to four decimal places)? Question 7Answer a. 134233.5495 b. 128177.7626 c. 127887.4496 d. 133859.7935
The Brown family recently bought a house. The house has a 30 year, $165,000 mortgage with a nominal interest rate of 10 percent. Payments are made at the end of each month. What is the total amount that will be repaid to the bank over the life of the loan?
If Martha borrowed $22,000 from Wachovia Bank at 7.5 percent interest for 3 years, the principal (face value) of the loan would be
Salem has borrowed $1,000,000 from MQ Bank for 10 years at an interest rate of j2=3.91%. She will make 10 annual repayments. According to the loan agreement, Salem's repayments will be $89,000 for the first two years followed by payments of with the amount of X per year for the remaining eight years. This loan needs to be fully repaid by the end of 10 years. (a) Assume that all annual repayments will be paid at the end of each year (the first payment will be at the end of the first year), what is the value of Salem's annual payment amount X (rounded to four decimal places)?
Ms Smith borrows 5000 at 5% annual effective interest, with payments at end of each year. The lender keeps the interest portion and accumulates the principal portion in a fund at 3.5% until loan is paid in full. Ms Smith pays 750 each year until a smaller payment will complete the loan payment. What is the amount of this last payment, including interest?
Kari is purchasing a home for $220,000. The down payment is 25% and the balance will be financed with a 15 year mortgage at 8% and 3 discount points. Kari made a deposit of $30,000 (applied to the down payment) when the sales contract was signed. Kari also has these expenses: credit report, $90; appraisal fee, $110; title insurance premium, 1% of amount financed; title search, $300; and attorney's fees, $500. Find the closing costs (in $).
K Erin took out a 15-year mortgage with an annual interest rate of 6% to purchase a house for $220,000 with a down payment of $20,000. Find the amount of the monthly payment needed to amortize this loan. The amount of the monthly payment needed to amortize this loan is $1687.71 (Round to the nearest cent as needed.)
You borrow $364000 for the the purchase of a house at an APR of 7.52% for 15 years. Your monthly payment is $3378.46. How much money will you pay in interest for this loan?
Gisella borrows $120, 000 from Capital Mortgage Co. at 9% per annum interest, monthly payments for 30 years. At the end of 6 years, she sells the house and will pay off the loan at the closing of sale (assume that the sale takes place at the end of the sixth year). What will her loan payoff be? Using excel functions only and an amortization schedule.

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