A home is purchased for $134550. The homeowner pays $26910 down and finances the balance for...

A home is purchased for $134550. The homeowner pays $26910 down and finances the balance for 20 years at 8% compounded monthly.

a. Find the size of the payments rounded up to the next cent.
$

b. How much of the first payment is interest?
$

c. How much is still owed on the loan just after 95 payments.
$

d. What is the owner's equity after 95 payments?
$

e. How much is owed just before the 95 payment is actually made?
$

Just after 95 payments are made, the loan is refinanced at 6.5% compounded monthly.

a. If the duration of the original loan remains the same, find the size of the new payments rounded up to the next cent.
$

b. If money is worth 5.25% compounded monthly to the homeowner, what is the present value of the savings in interest at the time of refinancing?
$

c. If the homeowner continues with the original payments, find the number of full payments required to pay off the loan.
full payments

d. Find the size of the smaller concluding payment at the end of the next month.
$

Solutions

Expert Solution

jeff jeffy answered 1 year ago

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