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This time we have been asked to provide financial advice for a client who is considering buying a home and is trying to compare all of the different options. While this client is smart, he is not very math literate, so please make sure to clearly explain your work. My standard rate is in effect for this project also.***By my count, there are around 18 questions to answer for this client EB Consulting Team Currently, I am looking at buying a home for $192,000 and I have $ 27,000 to spend up front on this house. My local bank has given me this chart that they claim shows all the different options on a 30 year loan. I have several questions about these options, namely: 1. What would be my monthly payment in each case, and what would be the total amount of money I would pay out over those 30 years in each case 2. Also, for each of the options where I buy points, how long will it take me to 'make up' the initial cost. Could you show me the details for each of these options? 3. PS My crystal ball is telling me that in exactly 12 years, the interest rate will drop to 2.8% for home loans, what would be the effects if I refinanced at that point? 4. How much equity (both in dollars and as a percentage of the value of the house) would I have at this point? 5. Below is the chart the bank gave me This chart really was pulled from a banks website Professor Eby*") about something called points on a loan? 6. Could you please explain the details of how this will impact my loan? RATE Compound POINTSFEE PAID FOR POINTS 5.50 5.38 5.00 0.00 0.50 1.70 0.00 700.008 S 2140.00 7.I am planning on having $980 total each month to pay toward my home, so could you now figure out all the details for the each of the initial three above options but paying my $ 980 each month This time we have been asked to provide financial advice for a client who is considering buying a home and is trying to compare all of the different options. While this client is smart, he is not very math literate, so please make sure to clearly explain your work. My standard rate is in effect for this project also.***By my count, there are around 18 questions to answer for this client EB Consulting Team Currently, I am looking at buying a home for $192,000 and I have $ 27,000 to spend up front on this house. My local bank has given me this chart that they claim shows all the different options on a 30 year loan. I have several questions about these options, namely: 1. What would be my monthly payment in each case, and what would be the total amount of money I would pay out over those 30 years in each case 2. Also, for each of the options where I buy points, how long will it take me to 'make up' the initial cost. Could you show me the details for each of these options? 3. PS My crystal ball is telling me that in exactly 12 years, the interest rate will drop to 2.8% for home loans, what would be the effects if I refinanced at that point? 4. How much equity (both in dollars and as a percentage of the value of the house) would I have at this point? 5. Below is the chart the bank gave me This chart really was pulled from a banks website Professor Eby*") about something called points on a loan? 6. Could you please explain the details of how this will impact my loan? RATE Compound POINTSFEE PAID FOR POINTS 5.50 5.38 5.00 0.00 0.50 1.70 0.00 700.008 S 2140.00 7.I am planning on having $980 total each month to pay toward my home, so could you now figure out all the details for the each of the initial three above options but paying my $ 980 each month
