Question

In: Finance

Suppose that you wish to buy a new home that will cost you $482,472. You must...

Suppose that you wish to buy a new home that will cost you $482,472. You must put $80,000 down, and the bank offers you a 5-year 5.4% APR negative amortization loan with a payments $1,218 per month, and a balloon payment of $67,789 (your 360th payment). How much will your remaining payments be?

Solutions

Expert Solution

Loan Amount = 482,472 - 80,000 = $402,472

Calculating Loan Balance after 5 years,

Using TVM Calculation,

FV = [PV = 402,472, PMT = -1,281, N = 60 ,I = 0.054/12]

FV = $443,222.42

Remaining Amount = 442,222.42 - 67,789

Remaining Amount = $375,433.42

jeff jeffy answered 2 years ago
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