You want to buy a house, and a local bank will lend you $100,000. The loan will be fully amortized over 20 years (240 months), and the nominal interest rate will be 0.1100 with interest paid monthly. What will be the loan's EAR? (Answer in decimal form to the nearest basis point. That is, 1/100th of a percent, or to four decimal places. Six and one-half percent will be entered as 0.0650)

You want to buy a house, and a local bank will lend you $100,000. The loan will be fully amortized over 20 years (240 months), and the nominal interest rate will be 0.1100 with interest paid monthly. What will be the loan's EAR? (Answer in decimal form to the nearest basis point. That is, 1/100th of a percent, or to four decimal places. Six and one-half percent will be entered as 0.0650)

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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You plan to purchase a $310,000 house using a 15-year mortgage obtained from your bank. The mortgage rate offered to you is 5.10 percent. You will make a down payment of 20 percent of the purchase price. a. Calculate your monthly payments on this mortgage. b. (1) Construct the amortization schedule for the mortgage. b. (2) How much total interest is paid on this mortgage?
You would like to buy a house for $850,000. You put $180,000 down, and then get a mortgage for the rest at 7.5%, compounded monthly. 1. Calculate the monthly mortgage and total cost of 360 payments if you amortize over 30 years. (Remember to round to 2 decimal places for each answer) 2. Calculate the monthly mortgage and total cost of 180 payments if you amortize over 15 years. (Remember to round to 2 decimal places for each answer) 3. List at least one benefit and at least one downside to each loan, and then tell me which would you prefer?
Find the interest rates earned on each of the following. Round your answers to the nearest whole number. You borrow $650 and promise to pay back $715 at the end of 1 year. % You lend $650, and the borrower promises to pay you $715 at the end of 1 year. % You borrow $100,000 and promise to pay back $136,857 at the end of 8 years. % You borrow $9,000 and promise to make payments of $2,684.80 at the end of each year for 5 years. %
You want to buy a car, and a local bank will lend you $15,000. The loan would be fully amortized over 6 years (72 months), and the nominal interest rate would be 6%, with interest paid monthly. What is the monthly loan payment? Do not round intermediate calculations. Round your answer to the nearest cent. $ What is the loan's EFF%? Do not round intermediate calculations. Round your answer to two decimal places. %
Suppose you intend to purchase a house worth $239,900 with a 30-year fixed rate mortgage. You have a down payment of 15%. (a) How much are you planning to finance? (b) Find the monthly payment needed to amortize the loan, at a rate of 2.4% compounded monthly. (c) Approximately how much of the loan will remain after 12 years?
You are buying a house for $120,000.00 with a downpayment of $12,000.00. The loan will be paid back over 25 years with monthly payments of $558.21. If the interest rate is 3.8% compounded monthly, what would the unpaid balance be immediately after the twenty-ninth payment? What is the equity after the twenty-ninth payment? The unpaid balance would be $. (Round to 2 decimal places.) The equity would be $
You want to buy a $130,000 home. You plan to pay 5% as a down payment, and take out a 30 4.65% interest for the rest. The bank will charge 1.5 points on the amount financed. year loan at a) What is the amount of the down payment? b) How much is the loan amount going be? c) What will be the amount charged for 1.5 points? 1 point is 1 % of the mortgage amount d) Find the amount of the monthly payment. (Do not add the cost of the points to the loan amount) Hint: click here
You have just purchased a new warehouse. To finance the purchase, you've arranged for a 34-year mortgage loan for 80 percent of the $3,240,000 purchase price. The monthly payment on this loan will be $15,700. a. What is the APR on this loan? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. What is the EAR on this loan? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
The bank will loan you $175,000 to buy a house. The loan terms are as follows; 30 year mortgage with monthly payments and a 6.9% annual interest rate (monthly compounding). What will your monthly payments be to the bank? If you will pay $1500 each year in taxes, $1200 in insurance, and $400 in HOA fees, how much will your total mortgage payments be each month? How much interest will you pay over the 30 year life of the loan?
You have just purchased a new warehouse. To finance the purchase, you've arranged for a 30-year mortgage loan for 80 percent of the $2,600,000 purchase price. The monthly payment on this loan will be $16,700. a. What is the APR on this loan? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the EAR on this loan? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Annual percentage rate b. Effective annual rate % %
You want to buy a $214,000 home. You plan to pay 10% as a down payment, and take out a 30 year loan at 5.6% interest for the rest.a) How much is the loan amount going to be?b) What will your monthly payments be?c) How much of the first payment is interest?
You plan to use a 15 year mortgage obtained from a local bank to purchase a house worth $124,000.00. The mortgage rate offered to you is 7.75%. You will make a down payment of 20% of the purchase price. a. Calculate your monthly payments on this mortgage. List in a spreadsheet the cash flow the bank expects to receive from you. Submit the spreadsheet with your answers. b. Calculate the amount of interest and principal for the 60th payment. Show your work. c. Calculate the amount of interest and principal to be paid on the 180th payment. Show your work. d. What is the amount of interest paid over the life of this mortgage?

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