Question
In: Finance
The mortgage on your house in Winnipeg is five years old. It required monthly payments of...
The mortgage on your house in Winnipeg is five years old. It required monthly payments of $1402, had an original term of 30 years, and had an interest rate of 9% (APR with semiannual compounding). In the intervening five years, interest rates have fallen, housing prices in the United States have fallen, and you have decided to retire to Florida. You have decided to sell your house in Winnipeg and use your equity for the down payment on a condo in Florida. You will roll over the outstanding balance on your old mortgage into a new mortgage in Florida. The new mortgage has a 30-year term, requires monthly payments, and has an interest rate of 6.625% (APR with monthly compounding, which is typical for U.S. mortgages).
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What monthly repayments will be required with the new loan?
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If you still want to pay off the mortgage in 25 years, what monthly payment should you make on your new mortgage?
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Suppose you are willing to continue making monthly payments of $1402. How long will it take you to pay off the new mortgage?
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Suppose you are willing to continue making monthly payments of $1402, and you want to pay off the mortgage in 25 years. How much additional cash can you borrow today as part of the new financing?
** please show the complete work out/steps with formulas. No excel sheets.**
Solutions
jeff jeffy answered 1 year agoRelated Solutions
The mortgage on your house in Winnipeg is five years old. It required monthly payments of...
The mortgage on your house in Winnipeg is five years old. It
required monthly payments of $1402, had an original term of 30
years, and had an interest rate of 9% (APR with semiannual
compounding). In the intervening five years, interest rates have
fallen, housing prices in the United States have fallen, and you
have decided to retire to Florida. You have decided to sell your
house in Winnipeg and use your equity for the down payment on a
condo...
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of 30 years, and had an interest rate of 10 % (APR with
semi-annual compounding). In the intervening 5 years, interest
rates have fallen, housing prices in the Unite States have
fallen, and you have decided to retire to Florida. You have decided
to sell your house in Winnipeg and use your equity for the...
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interest rates have fallen and so you have decided to refinance -
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had an interest rate of 10% APR (compounded monthly). In the
intervening five years, interest rates have fallen and so you have
decided to refinance—that is, you will roll over the outstanding
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The mortgage on your house is five years old. It required
monthly payments of SEK 12,000, had an original term of 30 years,
and had an interest rate of 5% (APR). In the intervening five
years, interest rates have fallen and so you have decided to
refinance - that is, you will roll over the outstanding balance
into a new mortgage. The new mortgage has a 30-year term, requires
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The mortgage on your house is five years old. It required monthly payments of SEK 12,000,...
The mortgage on your house is five years old. It required
monthly payments of SEK 12,000, had an original term of 30 years,
and had an interest rate of 6.0% (APR). In the intervening five
years, interest rates have fallen and so you have decided to
refinance - that is, you will roll over the outstanding balance
into a new mortgage. The new mortgage has a 30-year term, requires
monthly payments, and has an interest rate of 4.0% (APR).
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The mortgage on your house is five years old. It required monthly payments of $1,390, had...
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monthly payments of $1,390, had an original term of 30 years, and
had an interest rate of 9% (APR). In the intervening five years,
interest rates have fallen and so you have decided to refinance
long dash—that is, you will roll over the outstanding balance into
a new mortgage. The new mortgage has a 30-year term, requires
monthly payments, and has an interest rate of 6.125% (APR).
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refinance - that is, you will roll over the outstanding balance
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refinance—that is, you will roll over the outstanding balance into
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monthly payments, and has an interest rate of 5.625% (APR).
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