You want to borrow $300,000 to start a business. The loan initial balance is increased by...

You want to borrow $300,000 to start a business. The loan initial balance is increased by 2% of the loans face value(for loans origination fees, mortgage insurance, credit checks, title searches etc) Your annual payments are calculated using an initial balance of $306,00 an interest rate of 9% and a 20 year term. The bank requires you to refinance the loan in 5years by paying it off with a balloon payment. what interest rate are you paying?

Expert Solution

Let us observe the below table and the interest rate is highlighted in red color.

so, the rate of interest-paying is 3.5%.

Rahul Sunny answered 2 years ago

A person planned to start a business venture in Muscat and decided to borrow a loan...

A person planned to start a business venture in Muscat and decided to borrow a loan of OMR 52000 from Bank Muscat at an interest rate of 18 % per annum. Determine the following a) Simple interest and total amount due after 12 years if no intermediate payments are made and interest is compounded annually. b) Compound interest and total amount due after 9years if no intermediate payments are made and interest is compounded annually. c) Compound interest after 9...

You want to borrow $25,000. For the loan to be paid off, youmust repay $1000...

You want to borrow $25,000. For the loan to be paid off, you must repay $1000 every quarter (4 times per year) for the next 7 years plus $7000 at the end of the 7 years. Based on this, what rate of interest are you paying?

Suppose you and your friend want to start a business, and the friend suggests to start...

Suppose you and your friend want to start a business, and the friend suggests to start a movie dvd rental store in the bronx. Is that an attractive market? Discuss using Porter's Five Forces

Assume you want to take out a $300,000 loan on a 25-year mortgage with end of...

Assume you want to take out a $300,000 loan on a 25-year mortgage with end of month payments. The annual rate of interest is 8 percent. 20 years from now, you need to make an ending additional lump sum payment of $45,000. Because you expect your income to increase, you want to structure the loan so that the beginning of each year your monthly payments increase by 2.5 percent. Determine the amount of each year’s monthly payment with Excel Solver.

You wish to borrow $1,000 for 6 years to start a business. You approach different lenders...

You wish to borrow $1,000 for 6 years to start a business. You approach different lenders who have the following offers. Which is the best lender to borrow from? All percentage rates are rounded to 6 decimal places. Select one: a. 11.494938% pa APR compounding quarterly where there are exactly 4 quarters per year. b. 11.660105% pa APR compounding semi-annually where there are exactly 2 semi-annual periods per year. c. 2.873734% as an effective quarterly rate where there are exactly...

You wish to borrow $1,000 for 8 years to start a business. You approach different lenders...

You wish to borrow $1,000 for 8 years to start a business. You approach different lenders who have the following offers. Which is the best lender to borrow from? All percentage rates are rounded to 6 decimal places. Select one: a. 9.645476% pa APR compounding quarterly where there are exactly 4 quarters per year. b. 9.539758% pa APR compounding weekly where there are exactly 52 weeks per year. c. 2.411369% as an effective quarterly rate where there are exactly 4...

You are given a $200,000 loan to start a business with the interest rate of 3%....

You are given a $200,000 loan to start a business with the interest rate of 3%. How would you invest this money to be able to pay back the loan in 5 years and also make as much profit as you can? Describe the type of business that you would start and include the estimation of one-time cost and recurring cost. Your projects cannot be similar; otherwise, all similar projects will receive zero credit. Show your calculations; explain the basis...

s an entrepreneur, you want to start a business. You know that the first step is...

s an entrepreneur, you want to start a business. You know that the first step is to consider drafting a business plan to organize all of your ideas. For this assignment, you will be submitting a business plan for your imaginary business. For research purposes, you can choose any state for the location of your business. Your business plan should include the following: Introduction of the proposed business/executive summary The executive summary is often considered the most important section of...

Pretend you are going to be an entrepreneur and you want to start your own business. You...

Pretend you are going to be an entrepreneur and you want to start your own business. You have a great idea, you are ready and willing to work. You just need--money. You will need $500,000 to start your business. But you do not have that much money. You only have $50,000 available from your life savings. What avenue or avenues would you pursue to gain the money you need to get your business started? Explain what would work best for you, and...

James, Jill and John want to start a new business and want to be able to...

James, Jill and John want to start a new business and want to be able to raise about $1 million for the business from their family and friends. They are considering forming either a corporation or a limited liability company. Advise James, Jill and John on what is necessary to form and maintain (including administration, taxes, management, etc.) a corporation versus forming and maintaining a limited liability company. Your advice should include comments on the advantages and disadvantages of corporations...

Question