You are looking to buy a $350,000 home Your household has a combined income of $97,000 The interest rate is 4.23 Home Purchase price: $350,000 You have enough cash to cover: 20% down payment + points and fees Use the best interest rate from part 1 to get a 30-Year Fixed Rate Mortgage Number of points paid = 2 Each point purchased reduces the interest rate by .25% Loan origination rate = 1 % of home purchase price Appraisal fee: $500 Filing fee: $250 Credit report fee: $50 Provide: How much cash do you need to purchase ( down payment + points and fees) the home? What would be your loan amount? Using the best interest rate (not APR) from part 1 and buying 2 points, what would be your loan interest rate? What will be your monthly mortgage?
You are looking to buy a $350,000 home Your household has a combined income of $97,000 The interest rate is 4.23 Home Purchase price: $350,000 You have enough cash to cover: 20% down payment + points and fees Use the best interest rate from part 1 to get a 30-Year Fixed Rate Mortgage Number of points paid = 2 Each point purchased reduces the interest rate by .25% Loan origination rate = 1 % of home purchase price Appraisal fee: $500 Filing fee: $250 Credit report fee: $50 Provide: How much cash do you need to purchase ( down payment + points and fees) the home? What would be your loan amount? Using the best interest rate (not APR) from part 1 and buying 2 points, what would be your loan interest rate? What will be your monthly mortgage?
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
Related questions
Question
You are looking to buy a $350,000 home
Your household has a combined income of $97,000
The interest rate is 4.23
Home Purchase price: $350,000
You have enough cash to cover: 20% down payment + points and fees
Use the best interest rate from part 1 to get a 30-Year Fixed Rate Mortgage
Number of points paid = 2
Each point purchased reduces the interest rate by .25%
Loan origination rate = 1 % of home purchase price
Appraisal fee: $500
Filing fee: $250
Credit report fee: $50
Filing fee: $250
Credit report fee: $50
Provide:
How much cash do you need to purchase ( down payment + points and fees) the home?
What would be your loan amount?
Using the best interest rate (not APR) from part 1 and buying 2 points, what would be your loan interest rate?
Using the best interest rate (not APR) from part 1 and buying 2 points, what would be your loan interest rate?
What will be your monthly mortgage?
Based on:
Property tax rate/yr = 1% of home purchase price
Home insurance rate/yr = .5% of home purchase price
Monthly car payment(s) = $300/month
Credit card payments = $50/month
Student loans = $400/month
Property tax rate/yr = 1% of home purchase price
Home insurance rate/yr = .5% of home purchase price
Monthly car payment(s) = $300/month
Credit card payments = $50/month
Student loans = $400/month
Prior to the lending institution agreeing to loan you the money to buy the house the bank does a PITI and Annual evaluations
PITI:
How much is your Annual PITI? (PITI: Principle, Interest, Taxes, Insurance)
$
% of annual income
Is this PITI score within the acceptable ranges for banks to make this loan?
% of annual income
Is this PITI score within the acceptable ranges for banks to make this loan?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education