The vendor of a property agrees to take back a $200,000 mortgage at a rate of 4.5% compounded semiannually with monthly payments of $900 for a twenty-year term. Calculate the market value of the mortgage if financial institutions are charging 6.5% compounded semiannually on twenty-year term mortgages. A) $129,239.43 OB) $124,604.43 OC) $122,539.43 OD) $121,979.43 ○ E) $121,539.43

The vendor of a property agrees to take back a $200,000 mortgage at a rate of 4.5% compounded semiannually with monthly payments of $900 for a twenty-year term. Calculate the market value of the mortgage if financial institutions are charging 6.5% compounded semiannually on twenty-year term mortgages. A) $129,239.43 OB) $124,604.43 OC) $122,539.43 OD) $121,979.43 ○ E) $121,539.43

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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A $305,000 mortgage at 5.00% compounded semi-annually was settled with monthly payments of $2,300. a. What is the amortization period for the mortgage? b. How much will the amortization period be shortened by if bi-weekly payments of $1,200 are made instead of the monthly payments?
An investor buys a property for $665,000 with a 25-year mortgage and monthly payments at 8.5% APR. After 18 months the investor resells the property for $730,998. How much cash will the investor have made from the sale, once the mortgage is paid off? O A. $109,650 O B. $62,657 O C. $156,642 O D. $78,321
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
Assume a 30 year fixed rate, fully amortizing mortgage for $260,000 at a stated rate of 5% with monthly payments (no fees, points or escrows). What is the loan balance (or "payoff amount) - after 4 years? Ch4 a. b. C. 230,530 d. 190,949 194,843 243,438
Consider a 30-year, fixed-rate mortgage for $120,000 at a nominal rate of 6% with monthly payments. If the borrower pays an additional $120 with each monthly payment, what will be the amount of the last monthly payment? A. $839.46 B. $357.77 C. $843.66 D. $419.85 E. $355.99 F. $420.90 G. $418.81 H. $841.55
A builder is offering $117,767 loans for his properties at 9 percent for 25 years. Monthly payments are based on current market rates of 9.5 percent and are to be fully amortized over 25 years. The property would normally sell for $130,000 without any special financing. Required: a. At what price should the builder sell the properties to earn, in effect, the market rate of interest on the loan? Assume that the buyer would have the loan for the entire term of 25 years. Complete this question by entering your answers in the tabs below. Required A At what price should the builder sell the properties to earn, in effect, the market rate of interest on the loan? Assume that the buyer would have the loan for the entire term of 25 years. (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) Sale value $ 116,134
A property is available for sale that could normally be financed with a fully amortizing $80,200 loan at a 10 percent rate with monthly payments over a 25-year term. Payments would be $728.78 per month. The builder is offering buyers a mortgage that reduces the payments by 50 percent for the first year and 25 percent for the second year. After the second year, regular monthly payments of $728.78 would be made for the remainder of the loan term. Required: a. How much would you expect the builder to have to give the bank to buy down the payments as indicated? b. Would you recommend the property be purchased if it was selling for $5,000 more than similar properties that do not have the buydown available?
A floating rate mortgage loan is made for $185,000 for a 30-year period at an initial rate of 12 percent interest. However, the borrower and lender have negotiated a monthly payment of $1,480. Required: a. What will be the loan balance at the end of year 1? b. If the interest rate increases to 13 percent at the end of year 2, how much is the payment plus negative amortization in year 2 and year 5 if the payment remains at $1,480?
Of the bank approves a mortgage of 240,000 for 30 years and at a rate of 6% what will the the annnual mortgage payment
Assume that you take out a 30-year mortgage (360 months) with a face value of $425,000 and a stated annual rate of 2.51%. Given this information, and assuming no prepayments, determine what percentage of your 153rd monthly payment will go towards interest. A) 51.15% B) 63% C) 53.37% D) 35.25% E) 41.06%
A builder is offering $137,381 loans for his properties at 9 percent for 25 years. Monthly payments are based on current market rates of 9.5 percent and are to be fully amortized over 25 years. The property would normally sell for $150,000 without any special financing. Required: a. At what price should the builder sell the properties to earn, in effect, the market rate of interest on the loan? Assume that the buyer would have the loan for the entire term of 25 years. Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) b. At what price should the builder sell the properties to earn, in effect, the market rate of interest on the loan if the property is resold after 10 years and the loan repaid? Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.)
A$282,000 mortgage for 25 years for a new home is obtained at the rate of 6.5% compounded monithly. Find (a) the monthly payment, (b) the interest in the first payment, (c) the principal repaid in the first payment, and (d) the finance charge. (a) The monthly payment on the mortgage is S (Round the final answer to two decimal places as needed Round all intermediate values to six decimal places as needed.)

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