Ms. Madison has an existing loan with payments of $782.34. The interest rate on the loan...

Ms. Madison has an existing loan with payments of $782.34. The interest rate on the loan is 10.5% and the remaining loan term is 10 years. The current balance of the loan is $57,978.99. The home is now worth $120,000 and Ms. Madison would like to borrow an additional $30,000 through a wraparound loan which would increase the debt to 487,978.99. Terms of the wraparound loan are 12.25% interest with monthly payments for 10 years. What is the incremental cost of borrowing the extra $30,000 through a wraparound loan? Please answer using BA II Plus.

Expert Solution

ALL STEPS SHOWN WITH BA II PLUS.

JUST WRITTEN IN EXCEL

jeff jeffy answered 2 years ago

Dynamic Corporation has an existing loan in the amount of 10 million with an annual interest rate of

Dynamic Corporation has an existing loan in the amount of 10 million with an annual interest rate of 5.5%. The company provides an internal company-prepared financial statement to the bank under the loan agreement. Two competing banks have offered to replace Corporation's existing loan agreement with a new one. Money Tree Bank has offered to loan Dynamic $10 million at a rate of 4.4% but requires Dynamic to provide financial statements that have been reviewed by a CPA firm. Credit...

Quarterly payments of $675 are required to settle a loan. The interest rate on the loan...

Quarterly payments of $675 are required to settle a loan. The interest rate on the loan is 9.6% compounded quarterly. Find the amount of a single payment which will settle the debt on January 1, 2018 given the date of the first payment and the date of the last payment. a) April 1, 2011; October 1, 2016 b) July 1, 2019; April 1, 2023 c) January 1, 2005; July 1, 2010 ******* the answers given by the teacher are A.) 22,971.63...

Ms. Jordan has just taken out a $150,000 mortgage loan at an interest rate of 6...

Ms. Jordan has just taken out a $150,000 mortgage loan at an interest rate of 6 percent. If the mortgage calls for equal monthly payments for 20 years, what is the amount of each payment? Also, work out an amortization table

What is the annual interest rate of a loan $30000,15 years to maturity and payments of...

What is the annual interest rate of a loan $30000,15 years to maturity and payments of $275/Month?

A loan will be repaid in 5 years with monthly payments at a nominal interest rate...

A loan will be repaid in 5 years with monthly payments at a nominal interest rate of 9% monthly convertible. The first payment is $1000 and is to be paid one month from the date of the loan. Each succeeding monthly payment will be 2% lower than the prior payment. Calculate the outstanding loan balance immediately after the 40th payment is made.

Lara is repaying a loan of $500000 with semi-annual payments. This loan has a guaranteed interest...

Lara is repaying a loan of $500000 with semi-annual payments. This loan has a guaranteed interest period for 5 years in which the interest rate is given as j2= 6%. After that the interest rate changes to j4= 8%. After paying a down payment of $50000, each payment she pays for the first 5 years is $10000. After that, she pays X each time for another 10 years to totally cover this loan. (a) Calculate X (b) Calculate all the...

Junoic Corporation has an existing loan in the amount of $4 million with an annual interest...

Junoic Corporation has an existing loan in the amount of $4 million with an annual interest rate of 6.4%. The company provides an internal company-prepared financial statement to the bank under the loan agreement. Two competing banks have offered to replace Junoic Corporation's existing loan agreement with a new one. Green Back Bank has offered to loan Junoic $4 million at a rate of 4.9% but requires Junoic to provide financial statements that have been reviewed by a CPA firm....

Busch Corporation has an existing loan in the amount of $6 million with an annual interest...

Busch Corporation has an existing loan in the amount of $6 million with an annual interest rate of 6.0%. The company provides an internal company-prepared financial statement to the bank under the loan agreement. Two competing banks have offered to replace Busch Corporation’s existing loan agreement with a new one. United National Bank has offered to loan Busch $6 million at a rate of 5.0% but requires Busch to provide financial statements that have been reviewed by a CPA firm....

A loan is being amortized over n-years with monthly payments of $295.32. The rate of interest...

A loan is being amortized over n-years with monthly payments of $295.32. The rate of interest on the loan is j12=12%. The principal repaid in the 25th payment is $206.41.What is the size of the loan?

Amortize a $35,000 car loan with a 5% annual interest rate and payments for 60 months...

Amortize a $35,000 car loan with a 5% annual interest rate and payments for 60 months (4) What is the monthly payment? (5) What will the balance on the loan be after 2 years of payments? (Assume that you just took out the loan) (6) How many months will it be before the car is halfway paid off?

Question