Question
In: Finance
1. You are interested in buying a 2-bedroom condo in Cincinnati. The price is $300,000. You...
1. You are interested in buying a 2-bedroom condo in Cincinnati. The price is $300,000. You have a 30-year 3% APR mortgage with 20% down payment.
a. What would be the monthly mortgage payment?
b. Suppose you rent the property out and the rental you collect will just cover the
mortgage payment. You plan to keep the property till the mortgage matures and do not plan to make any pre-payment. What is your annual investment return (please calculate the bond-equivalent yield)?
c. You rent the apartment out for $2,000/month. The operating expense is $200. Assume the house value will increase by 30% after 30 years. Calculate the expected annual return of your investment. (Hint: compute IRR for the investment)
Solutions
jeff jeffy answered 1 year agoRelated Solutions
Billy McMahon is interested in buying a waterfront condo and has saved $100,000 for the down...
Billy McMahon is interested in buying a waterfront condo and has
saved $100,000 for the down payment. His plans call for making
additional monthly deposits into an investment account over the
next 36 months. Billy McMahon wants to make the purchase 48 months
from today and wants to have $180,000 saved up for the down
payment.
A) What is the amount of each of the additional payments he must
make for his plan to work out? Assume Billy can earn...
Billy McMahon is interested in buying a waterfront condo and has saved $100,000 for the down...
Billy McMahon is interested in buying a waterfront condo and has
saved $100,000 for the down payment. His plans call for making
additional monthly deposits into an investment account over the
next 36 months. Billy McMahon wants to make the purchase 48 months
from today and wants to have $180,000 saved up for the down
payment.
a. What is the amount of each of the additional payments he must
make for his plan to work out? Assume Billy can earn...
Billy McMahon is interested in buying a waterfront condo and has saved $100,000 for the down...
Billy McMahon is interested in buying a waterfront condo and
has saved $100,000 for the down payment. His plans call for making
additional monthly deposits into an investment account over the
next 36 months. Billy McMahon wants to make the purchase 48 months
from today and wants to have $180,000 saved up for the down
payment.
What is the amount of each of the additional payments he must
make for his plan to work out? Assume Billy can earn 2%...
The price of a car you are interested in buying is $93.75k. You negotiate a 6-year...
The price of a car you are interested in buying is
$93.75k. You negotiate a 6-year loan, with no money down
and no monthly payments during the first year. After the first
year, you will pay $1.2k per month for the following 5
years, with a balloon payment at the end to cover the remaining
principal on the loan. The annual percentage rate (APR) on the loan
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The price of a car you are interested in buying is $93.65k. You negotiate a 6-year...
The price of a car you are interested in buying is
$93.65k. You negotiate a 6-year loan, with no money down
and no monthly payments during the first year. After the first
year, you will pay $1.26k per month for the following 5
years, with a balloon payment at the end to cover the remaining
principal on the loan. The annual percentage rate (APR) on the loan
with monthly compounding is 5%. What will be the amount of the
balloon...
The price of a car you are interested in buying is $93.45k. You negotiate a 6-year...
The price of a car you are interested in buying is $93.45k. You
negotiate a 6-year loan, with no money down and no monthly payments
during the first year. After the first year, you will pay $1.23k
per month for the following 5 years, with a balloon payment at the
end to cover the remaining principal on the loan. The annual
percentage rate (APR) on the loan with monthly compounding is 5%.
What will be the amount of the balloon...
You are interested in buying a brand new Jalopy and expect the purchase price to be...
You are interested in buying a brand new Jalopy and expect the
purchase price to be $19,000. The car dealership can offer
financing at a 6% interest rate over 6 years. If you put $1,000
down towards the purchase and accept the financing terms,what will
your monthly payment for the loan be?
Please Show the excel formula
You have just borrowed $300,000 to buy a condo. You will repay the loan in equal...
You have just borrowed $300,000 to buy a condo. You will repay
the loan in equal monthly payments of $3,950.37 over the next 20
years. a-1. What monthly interest rate are you paying on the loan?
(Do not round intermediate calculations. Enter your answer as a
percent rounded to 2 decimal places.) a-2. What is the APR? (Do not
round intermediate calculations. Enter your answer as a whole
percent.) b. What is the effective annual rate on that loan? (Do...
Suppose you are buying a beach house condo for $450,000. You are planning to finance the...
Suppose you are buying a beach house condo for $450,000. You are
planning to finance the ENTIRE amount of the condo via a mortgage
for 30 years, 5% fixed, 0-points. The HOA fees, property taxes,
Annual maintenance + Upkeep of the condo = $12,000 per year.
Utilities are $150/month You are planning to rent this condo, and
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You are buying a condo on the beach in Galveston, TX. Here are the details. Overview:...
You are buying a condo on the beach in Galveston, TX. Here are
the details.
Overview:
condo 893 sqft
2 beds $286/sqft
2 baths 673
Built in 2006
131 days on Trulia
Description:
New washer/dryer, fresh paint in living and kitchen in October.
This condo is one of the best on Seawall. enjoy the beautiful
interior with its relaxed atmosphere. You'll be drawn to the
balcony where you will enjoy the amazing biew of the ocean and
enjoy the sounds...
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