I NEED HELP WITH JUST THE FIRST 3 QUESTIONS HOWEVER I POSTED WVWEY THING BECAUSE I DON'T WANT TUTORS TO COMMENT "INCOMPLETE" THIS IS EVERYTHING I HAVE FOR THE ASSIGNMENT!!

PLEASE HELP ME WITH THIS PROBLEM, PLEASE ANSWER ALL 3 QUESTIONS.. THANK YOU!

• You have an opportunity to acquire a property from First Capital Bank. The bank recently obtained the property from a borrower who defaulted on his loan. First Capital is offering the property for $200,000. If you buy the property you will have to (1) spend $10,500 on various acquisition related expenses and (2) exactly $2,000/month during the next 12 months for repairs in order to prepare for sale. Because First Capital Bank would like to sell the property as soon as possible, it is willing to provide 90% LTV mortgage at 8% for one year interest only. You believe the property will sell for $270,000 at the end of one year. You will incur a 6% in selling costs. What is you expected annual return on this investment?

• Is this a good investment and why?

• What counteroffer would you consider making First Capital and why?

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

You are considering an option to purchase or rent a single family property. You can rent it for $2,800/month and the owner will be responsible for maintenance, insurance and property taxes. Alternatively, you can purchase this property for $500,000 and finance it with an 80% mortgage at 6% on a 30 year schedule. The loan can be repaid at any time without penalty. Closing cost will equal 2% of the sales price.You have fund that properties in the market area have increased 3% annually, maintenance and insurance are eachcurrently $1,500/each/year, taxes are 2.5% of value and water/sewer is $100/month. Selling costs are equal to 7%.

if your investment threshold is 10%, should you buy this property and why? Include in your answer the expected holding period and why>?