Question
QUESTION 1 Loan Option 1: 279,000; 5.3875%; 30 years with 1 point Loan Option 2: $279,000; 5.875%; 30 years with no points If you decide
QUESTION 1
Loan Option 1: 279,000; 5.3875%; 30 years with 1 point
Loan Option 2: $279,000; 5.875%; 30 years with no points
If you decide to take Loan Option 1 that offers the points, what is your principal balance after 7 years?
| $269,473.22 | ||
| $295,309.83 | ||
| $247,260.48 | ||
| $279,000 |
1 points
QUESTION 2
Loan Option 1: 279,000; 5.3875%; 30 years with 1 point
Loan Option 2: $279,000; 5.875%; 30 years with no points
If you decide to take Loan Option 1 that offers the points, and you have already calculated the principal loan balance after 7 years. Now you decide to refinance after (use the principal loan balance after 7 years) for a 30 year loan at 4.10% with $2,650 of closing costs. What is your new payment and how long will it take for you to break even from refinancing?
| monthly payment = $1,275.75 break even piont = 8.34 months | ||
| monthly payment = $1,194.76 break even piont = 7.27 months | ||
| monthly payment = $1,597.49 break even piont = 7.00 months | ||
| monthly payment = $1,344.84 break even piont = 9.72 months |
1 points
QUESTION 3
Loan Option 1: 279,000; 5.3875%; 30 years with 1 point
Loan Option 2: $279,000; 5.875%; 30 years with no points
Looking at these two loans, what is the total amount of interest paid for Loan Option 1?
| $296,492.33 | ||
| $279,000.00 | ||
| $284,216.40 | ||
| $563,216.40 |
1 points
QUESTION 4
If the most the bank will allow you to finance (the largest home loan you are able to obtain) is for $279,000; how big of a house can you buy if you put down 20%?
| $348,750 | ||
| $362,780 | ||
| $285,863 | ||
| $279,000 |
1 points
QUESTION 5
Loan Option 1: 279,000; 5.3875%; 30 years with 1 point
Loan Option 2: $279,000; 5.875%; 30 years with no points
1. Compare the two loans: (a) what are their monthly payments and (b) if you chose the loan with points, how long would it take for you to break even?
| loan 1 = $1,794.92 loan 2 = $1,650.39 break even points = 27.75 month | ||
| loan 1 = $1,385.73 loan 2 = $1,279.47 break even points = 30.57months | ||
| loan 1 = $1,564.49 loan 2 = $1,650.39 break even points = 35.19 months | ||
| loan 1 = $1,797.49 loan 2 = $1,769.64 break even points = 39.26 months |
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