Question

In: Finance

The Young household is looking at buying a house. The three houses they are looking at...

The Young household is looking at buying a house. The three houses they are looking at cost the following: $160,000, $190,000 and $210,000. They can pay up to $900 in monthly mortgage payments. They currently have $18,000 set aside for a down payment. Similarly to the Tremblay’s bank, the Youngs’ bank will add $40 to each mortgage payment if they put less than 20% down and an additional fee of $30 more to each payment if they put less than 10% down.
Which of these houses can they afford with a 30-year mortgage at an interest rate of 3.5%?
Which of these houses can they afford with a 15-year mortgage at an interest rate of 2.8%?

Solutions

Expert Solution

jeff jeffy answered 8 months ago
Next > < Previous

Related Solutions

You are looking at buying a house with a $180,000 loan amount. You have 2 options...
You are looking at buying a house with a $180,000 loan amount. You have 2 options for this loan: 1) 15 Year Loan, you can get a monthly interest rate of 0.3% monthly. A) What is your monthly payment? B) What is the total amount you would pay out of pocket over the life of the loan? C) How much interest have you paid? 2) 30 year Loan, you can get a monthly interest rate of 0.3125% monthly. A) What...
There six houses on a block. Two of these houses have pools. Three houses on this...
There six houses on a block. Two of these houses have pools. Three houses on this block are selected at random. A. Find the probability that exactly 0 of the selected houses have a pool. B. Find the probability that exactly 2 of the selected houses have a pool. C. Find the probability that all of the selected houses have a pool. D. Find the probability that at least 1 of the selected houses has a pool.
Luke and Amy are saving for the down payment on a house. The houses in the...
Luke and Amy are saving for the down payment on a house. The houses in the area they prefer have an average selling price of $450,000 and they need a 10% down payment to ensure their mortgage payments are not too high. They have $30,000 saved that they can invest today at 6.5% (annual compounding). a) How long before they will have enough for the down payment saved? b) They want to buy the house sooner.  In addition to the $30,000...
Test if there is a significant difference in house prices for houses with 4 or more...
Test if there is a significant difference in house prices for houses with 4 or more bedrooms, if compared to houses with 3 or less bedrooms. Answer the questions for Assessment. (Pick the closest answer) 1. What is the P-value? a. 0.074081031 b. ​​1.85525E-07 c. 0.002738669 d. 0.000144083 2. What is the Statistical interpretation? a. The P-value is too small to have a conclusive answer. b. The P-value is much smaller than 5% thus we are very certain that house...
You are saving for the down payment on a house. The houses in the area you...
You are saving for the down payment on a house. The houses in the area you prefer have an average selling price of $450,000 and you need a 10% down payment to ensure your mortgage payments are not too high. You have $30,000 saved that you can invest today at 6.5% (annual compounding). a) How long before you will have enough for the down payment saved? b) You want to buy the house sooner. In addition to the $30,000 saved...
Freddy and Frieda Finance are looking to buy a house. They find a house that they...
Freddy and Frieda Finance are looking to buy a house. They find a house that they like costing $400,000 and have a $100,000 as a down payment meaning they will need a mortgage loan of $300,000 if they pay their closing costs in cash. Help them evaluate some mortgage options. 1. Nautical Bank offers a 30-year fixed rate mortgage with a nominal annual rate of 3.125%. What would be the Finances’ monthly payment under this loan? 2. Construct an amortization...
Freddy and Frieda Finance are looking to buy a house. They find a house that they...
Freddy and Frieda Finance are looking to buy a house. They find a house that they like costing $400,000 and have a $100,000 as a down payment meaning they will need a mortgage loan of $300,000 if they pay their closing costs in cash. Help them evaluate some mortgage options. 1. Nautical Bank offers a 30-year fixed rate mortgage with a nominal annual rate of 3.125%. What would be the Finances’ monthly payment under this loan? 2. Construct an amortization...
Samantha and Vikas are looking to buy a house in a new development. After looking at...
Samantha and Vikas are looking to buy a house in a new development. After looking at various models, the three models they like are colonial, split-entry, and single-story. The builder gave them the base price and the finished area in square feet of the three models. They want to know the model(s) with the least price per square foot. Instructions Write a program that accepts as input the base price and the finished area in square feet of the three...
On a block of ten houses, k are not insured. A tornado randomly damages three houses...
On a block of ten houses, k are not insured. A tornado randomly damages three houses on the block. The probability that none of the damaged houses are insured is 1/120. Calculate the probability that at most one of the damaged houses is insured.
You are looking to buy your first house. The cost of the house is $325,000. The...
You are looking to buy your first house. The cost of the house is $325,000. The bank has agreed to make a loan to you for 30 years at 3.15% if you can make a down payment of 7.00%, and the loan payments do not exceed 36% of your gross monthly income. Based upon this information: What is the amount of the mortgage loan that the bank will lend to you? What will be the amount of your monthly payments?...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT