Annette Rintell has been making end-of-month repayments of $1609.25 on a 30-year $200 000 mortgage...

Annette Rintell has been making end-of-month repayments of $1 609.25 on a 30-year $200 000 mortgage with the Riverside Savings Bank for the last 10 years. The interest rate has remained fixed for this period of time at 9% p.a. compounded monthly. Annette has been advised that the Rock Building Society has a special home loan offer at present where they have agreed to meet any payout fees in order to have customer loans transferred to them at their special rate of 7% compounded half-yearly with payments required half-yearly in advance.

Required:

(1) What would be the current payout figure on Annette’s home loan with the Riverside Savings Bank (to the nearest dollar)?

(2) What would be the new half-yearly repayment if the loan was transferred to the Rock Building Society?

Solutions

Expert Solution

(1) What would be the current payout figure on Annette’s home loan with the Riverside Savings Bank (to the nearest dollar)?

Cumulative Principal paid till year 10: $21140.51

Loan Outstanding Balance after 10 years = Loan Amount - Cumulative Principal paid

Loan Outstanding Balance after 10 years = 200000 - 21140.51

Loan Outstanding Balance after 10 years = $178859.49 (Answer)

(2) What would be the new half-yearly repayment if the loan was transferred to the Rock Building Society?

New half Yearly payment: $8092.27 (Answer)

jeff jeffy answered 2 years ago

Next > < Previous

Related Solutions

A loan is to be repaid over 30 years, with month-end repayments of 3,000. If the...

A loan is to be repaid over 30 years, with month-end repayments of 3,000. If the interest rate is 6.5% p.a. compounded monthly. Calculate the principal paid for year 10. Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67)

A loan is to be repaid over 30 years, with month-end repayments of 9,000. If the...

A loan is to be repaid over 30 years, with month-end repayments of 9,000. If the interest rate is 7.0% p.a. compounded monthly. Calculate the interest paid for year 10. Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67)

A loan is to be repaid over 30 years, with month-end repayments of 8,000. If the...

A loan is to be repaid over 30 years, with month-end repayments of 8,000. If the interest rate is 3.8% p.a. compounded monthly. Calculate the interest paid for year 10. Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67)

A loan is to be repaid over 30 years, with month-end repayments of 8,000. If the...

A loan is to be repaid over 30 years, with month-end repayments of 8,000. If the interest rate is 4.9% p.a. compounded monthly. Calculate the loan outstanding balance at the end of 10 years. Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67)

A loan is to be repaid over 30 years, with month-end repayments of 4,000. If the...

A loan is to be repaid over 30 years, with month-end repayments of 4,000. If the interest rate is 5.3% p.a. compounded monthly. Calculate the principal paid for year 10. Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67)

A loan is to be repaid over 30 years, with month-end repayments of 6,000. If the...

A loan is to be repaid over 30 years, with month-end repayments of 6,000. If the interest rate is 4.9% p.a. compounded monthly. Calculate the interest paid for year 10. Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67).

A loan of 673,000 is to be repaid in 30 years by month-end repayments starting in...

A loan of 673,000 is to be repaid in 30 years by month-end repayments starting in one month. The interest rate is 6.3% p.a. compounded monthly. Calculate the interest paid in Year 5. (between the end of month 48 and the end of month 60). Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67) (Hint: you can use Excel to find the answer.) Answer:

A loan of 941,000 is to be repaid in 20 years by month-end repayments starting in...

A loan of 941,000 is to be repaid in 20 years by month-end repayments starting in one month. The interest rate is 8.4% p.a. compounded monthly. Calculate the principal paid in Year 6. (between the end of month 60 and the end of month 72). Correct your answer to the nearest cent without any units. (Do not use "$" or "," in your answer. e.g. 12345.67) (Hint: you can use Excel to find the answer.)

You take out a 25 year, $275, 000 mortgage with constant payments at the end of...

You take out a 25 year, $275, 000 mortgage with constant payments at the end of each month and i (12) = 6%. After 15 years, you wish to refinance the mortgage with a 10 year mortgage (also with constant payments at the end of each month) so that you pay $100 less each month than you originally were paying. Find the monthly nominal interest rate corresponding to this new mortgage

A 30-year annuity has end-of-month payments. The first year the payments are $120 each. In subsequent...

A 30-year annuity has end-of-month payments. The first year the payments are $120 each. In subsequent years the monthly payment increases by $5 over what it was the previous year. Find the accumulated value of this annuity if AEIR=3% A. 84,820 B. 42,390 C. 105,070 D. 100,620 E. 41,560

Subjects