encesRental Costs.Annual rentInsuranceSecurity depositBuying CostsAnnual mortgage paymentsProperty taxesInsurance, maintenanceDown payment, closing costsGrowth in equityEstimated annual appreciation$ 7,5201521,050Rental costBuying costTotal Cost$ 10,600 ($ 9,606 is interest)2,170Assume an after-tax savings interest rate of 5 percent and a tax rate of 28 percent.a. Calculate the total rental cost and total buying cost.1,9204,5009943,000

Mortgage:A mortgage is a financial arrangement wherein a borrower secures a loan from a lender,…

Rental Costs. Annual rent Insurance Security deposit $ 7,520 152 1,050 Buying Costs Annual mortgage payments Property taxes Insurance, maintenance Down payment, closing costs Growth in equity Estimated annual appreciation $ 10,600 ($ 9,606 is interest) 2,170 1,920 4,500 994 3,000 Assume an after-tax savings interest rate of 5 percent and ax rate of 28 percor

Rental Costs. Annual rent Insurance Security deposit $ 7,520 152 1,050 Buying Costs Annual mortgage payments Property taxes Insurance, maintenance Down payment, closing costs Growth in equity Estimated annual appreciation $ 10,600 ($ 9,606 is interest) 2,170 1,920 4,500 994 3,000 Assume an after-tax savings interest rate of 5 percent and ax rate of 28 percor

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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Based on the following data, calculate the items requested: Rental Costs Buying Costs Annual rent $ 7,530 Annual mortgage payments $ 10,100 (9,650 is interest) Insurance $ 160 Property taxes $ 1,840 Security deposit $ 725 Down payment/closing costs $ 4,800 Growth in equity $ 450 Insurance/maintenance $ 1,200 Estimated annual appreciation $ 1,850 Assume an after-tax savings interest rate of 5 percent and a tax rate of 26 percent. Assume this individual has other tax deductions that exceed the standard deduction amount. a. Calculate total rental cost and total buying cost. (Do not round intermediate calculations. Round your answers to the nearest whole dollar.) b. Would you recommend buying or renting? multiple choice Renting Buying
A commercial property has expected first year NOI of $48,000. If the required debt coverage ratio is 1.25 for a mortgage at 6% with 30-year amortization, what is the maximum loan amount? O $500,375 O $533,733 O $567,091 O $600,450 O $633,808
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Suppose you earn a gross income of $2,920.00 per month and apply for a mortgage with a monthly PITI of $908.12. You have other financial obligations totaling $169.36 per month. If the lending ratio guidelines are as given in the table below, what type of mortgage, if any, would you qualify for? Mortgage Type Housing Expense Ratio Total Obligations Ratio FHA 29% 41% Conventional 28% 36% A. FHA only B. Conventional only C. FHA and Conventional D. None of the above
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Estimate the affordable monthly mortgage payment, the affordable mortgage amount, and the affordable home purchase price for the following situation. Use Exhibit 7-6, Exhibit 7-7. Note: Round your intermediate and final answers to the nearest whole dollar. Monthly gross income $ 4,850 Other debt (monthly payment) $260 20-year loan at 5 percent Down payment to be made (percent of purchase price ) 10 percent Monthly estimate for property taxes and insurance $ 385
Sales price = $375,000 Interest Rate on 1st mortgage = 3.750% Interest Rate on fixed rate 2nd mortgage = 4.00% 30-year fixed conventional Down Payment = 10% Taxes = $400 monthly Homeowners Insurance = $100 monthly What is the PITI using both mortgages? Choices: $2,014.35 $2,053.94 $2,118.41 $2,068.38
Using the residential mortgage-debt to income ratio of 28%, and total-debt to income ratio of 36%, what is the largest loan (with a 30-year FRM at 6%) you can qualify for if you make $38,000 a year and have outstanding debt with $250/month payments? O $113,418 O $140,107 O $150,112 $155,616 O $148,445
Assuming a 28% lender's affordability ratio, estimated monthly property taxes and insurance of P250, a 25% down payment (of the purchase price), and an annual gross income of P84,800, calculate the maximum purchase price based on monthly income. The monthly payment will occur at the end of the month and you plan to pay off the mortgage over a 30-year period at a 6.25% annual interest rate. a.P374,343b.P280,757c.P282,219d.P321,360e.None of the above
Estimate the affordable monthly mortgage payment, the affordable mortgage amount, and the affordable home purchase price for the following situation. (Refer to the images) Note: Round time value factor to 2 decimal places, intermediate and final answers to the nearest whole number. Mortgage Monthly gross income $ 4,700 Down payment to be made (percent of purchase price) 20% Other debt (monthly payment) $ 260 Monthly estimate for property taxes and insurance $ 490 30-year loan 8.0% 1.) What is the affordable monthly mortgage payment? 2.) What is the affordable mortgage amount? 3.) What is the affordable house purchase price?
Answer in the box is incorrect.
Consider a $100,000 30-year, fixed-rate mortgage with an annual interest rate of 5.50% and monthly payments. How much of the total expenses on mortgage payments go toward interest during the first three years (round to the nearest dollar)?$2, 540 $10, 220 $15,858 S4,274 $16, 167 $19, 172 $3,583

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