1. Brody knows that he can afford a monthly mortgage payment of $1500. The bank will offer him a mortgage rate of 2.14% compounded monthly over a 25 years period. Calculate the most expensive home that Brodu could afford, of course, Brody and his friend Bernie are going to build it. P= R= A= ZI DI T |= N= wwwwww 2. Now that Brody has figured out the most expensive house he can afford, Brody buys a building lot and all the material to build his house for $300 000. Of course, Brody with have the help of his electrician friend Bernie, his friend Barron a HVAC specialist and his brother Bear who operates an ant farm. On the closing date, Buddy will need to present a cheque to the bank that includes the following expenses: Down payment of 10% of the $ 300 000 for the lot and building supplies Legal fees: $700 Land transfer fee: 0.75% of selling price CMHC fee: $2800 a) What amount will Brody need to present on the closing date? b) The down payment from above will come off the value of the mortgage. How much will Brody still owe on the mortgage? c) Given the amount of money from part b) that Brody must borrow, calculate Brody's monthly payments (use 2.14% as the interest rate and a 30 year amortization). P | N