Question
In: Finance
4. A borrower takes out a 30-year mortgage loan for $100,000 with an interest rate of...
4. A borrower takes out a 30-year mortgage loan for $100,000
with an interest rate of 6% plus 2 points. What is the effective
annual interest rate on the loan if the loan is carried for all 30
years?
(A) 6.0%
(B) 6.2%
(C) 6.4%
(D) 6.6%
Solutions
Expert Solution
I HAVE SOLVED MANY SUMS. SOME BOOKS ARE WRITING ANNUAL EFFECTIVE COST AS "APR" AND SOME BOOKS "EAR". HERE CONFUSION IS WHAT TO TAKE BECAUSE APR = 6.2% AND EAR = 6.4%
HERE I AM TAKING IT AS EAR = (C) = 6.4%. THANK YOU
jeff jeffy answered 4 months agoRelated Solutions
A borrower takes out a 30-year mortgage loan for $100,000 with an interest rate of 6%...
A borrower takes out a 30-year mortgage loan for $100,000 with
an interest rate of 6% plus 4 points. Payments are to be made
monthly.
a. What is the effective cost of borrowing on the loan if the
loan is carried for all 30 years?
b. What is the effective cost of borrowing on the loan if the
loan is repaid after 10 years?
a borrower takes out a 15 year mortgage loan for 100,000 with an interest rate of...
a borrower takes out a 15 year mortgage loan for 100,000 with an
interest rate of 5% plus 3 points. what is the effective annual
interest rate on the loan if the loan is carried 15 years.
A borrower takes out a 30-year mortgage loan for $250,000 with an interest rate of 5%...
A borrower takes out a 30-year mortgage loan for $250,000 with
an interest rate of 5% and monthly payments.
What portion of the first month’s payment would be applied to
Interest?
A borrower takes out a 30-year mortgage loan for $250,000 with an interest rate of 6%...
A borrower takes out a 30-year mortgage loan for $250,000 with
an interest rate of 6% and monthly payments. What portion of the
first month's payment would be applied to interest? ($1250) Assume
the question above was a negative amortization loan, what would be
the balance after 3 years?
. A borrower takes out a 30 - year adjustable rate mortgage loan for $200,000 with...
. A borrower takes out a 30 - year adjustable rate mortgage loan
for $200,000 with monthly payments. The first two years of the loan
have a “teaser” rate of 4%, after that, the rate can reset with a
2% annual rate cap. On the reset date, the composite rate is 5%.
What would the Year 3 monthly payment be?
(A) $955
(B) $1,067
(C) $1,071
(D) $1,186
(E) Because of the rate cap, the payment would not change.
A borrower takes out a 15-year mortgage loan for $490,000 with an interest rate of 4.5%....
A borrower takes out a 15-year mortgage loan for $490,000 with
an interest rate of 4.5%. If she wants to pay off the loan after 6
years, what would be the outstanding balance on the loan?
A borrower takes out a 30-year adjustable rate mortgage loan for $325,000 with monthly payments.
A borrower takes out a 30-year adjustable rate mortgage loan for
$325,000 with monthly payments. The first two years of the loan
have a "teaser" rate of 4%, after that, the rate can reset with a
5% annual payment cap. On the reset date, the composite rate is 6%.
Assume that the loan allows for negative amortization. What would
be the outstanding balance on the loan at the end of Year 3?
A borrower takes out a 30-year adjustable rate mortgage loan for $200,000 with monthly payments. The...
A borrower takes out a 30-year adjustable rate mortgage loan for
$200,000 with monthly payments. The first two years of the loan
have a "teaser" rate of 2%, after that, the rate can reset with a
7% annual payment cap. On the reset date, the composite rate is 6%.
Assume that the loan allows for negative amortization. What would
be the outstanding balance on the loan at the end of Year 3?
A borrower takes out a 30-year adjustable rate mortgage loan for $400,000 with monthly payments. The...
A borrower takes out a 30-year adjustable rate mortgage loan for
$400,000 with monthly payments. The first two years of the loan
have a “teaser” rate of 4%, after that, the rate can reset with a
2% annual rate cap. On the reset date, the composite rate is 5%.
What would the Year 3 monthly payment be?
A borrower takes out a 30-year adjustable rate mortgage loan for $200,000 with monthly payments. The...
A borrower takes out a 30-year adjustable rate mortgage loan for
$200,000 with monthly payments. The first two years of the loan
have a “teaser” rate of 4%, after that, the rate can reset with a
5% annual payment cap. On the reset date, the composite
rate is 6%. What would the Year 3 monthly payment be? with the way
please.
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- 1.) Think back to August 6, 1945. The United States has just dropped an atomic weapon...
- Carry out the equipment and operating procedures between injection molding of thermoplastics and injection molding of...
- The cumulative timing approach was used to time a job and its elements. Use the following...
- absorption refection scattering refraction and diffraction can all have an impact on RF signal strength. Identify...
- This is my code I need to complete it? //The code package arraylists; import java.util.ArrayList; import...
- Organization management function at Tesla, and how can they improve the structure
- A company orders every 8 weeks. 52 weeks/8 weeks per order = 6.5 orders per year....
ADVERTISEMENT