Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Give me an example of A mortgage loan in the amount of $ 1 0 0 , 0 0 0 is made at 6 percent

Give me an example of A mortgage loan in the amount of $100,000 is made at 6 percent interest for 20 years. Payments are to be monthly in each part of this problem.
Required:
What will monthly payments be if
(1) The loan is fully amortizing?
(2) It is partially amortizing and a balloon payment of $50,000 is scheduled at the end of year 20?
(3) It is a non-amortizing, or interest-only loan?
(4) It is a negative amortizing loan and the loan balance will be $150,000 at the end of year 20?
What will the loan balance be at the end of year 5 under parts a (1) through a (4)?
Assume that the lender charges 3 points to close the loans in parts a (1) through a (4). What would be the APR for each?
Assuming that 3 points are paid at closing and the 20-year loan is prepaid at the end of year 5, what will be the effective rate of interest for each loan in parts a (1) through a (4)?
Assume the loan is fully amortizing except that payments will be interest only for the first three years (36 months). If the loan is to fully amortize over the remaining 17 years, what must the monthly payments be from year 4 through year 20?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

A Financial Crisis Manual Reflections And The Road Ahead

Authors: Dimitrios D. Thomakos , Platon Monokroussos, Konstantinos I. Nikolopoulos

1st Edition

1137448296, 113744830X, 9781137448293, 9781137448309

More Books

Students also viewed these Finance questions

Question

What is cash from operating activities?

Answered: 1 week ago

Question

What is the return type of the showInputDialog method?

Answered: 1 week ago