Question

In: Finance

Edward signs a 30 year mortgage at 3.5% compounded monthly. The price of his house is...

Edward signs a 30 year mortgage at 3.5% compounded monthly. The price of his house is $200,000. He makes a down payment of 40,000. Answer the following:

What will be his monthly payments?

After 5 years, he makes a one-time payment of $50,000 (against the remaining principle). How many months will he have remaining on his mortgage? To avoid any confusion, he will have exactly 25 years remaining before he makes the $50,000 in payment.

Edwards decides that instead of reducing the NPER after making the $50,000, he requests the bank to keep the NPER to 25 years and reduce his monthly payment instead. What will be his monthly payment going forward?

Solutions

Expert Solution

jeff jeffy answered 1 year ago
Next > < Previous

Related Solutions

Consider a 30-year mortgage with an interest rate of 10% compounded monthly and a monthly payment...
Consider a 30-year mortgage with an interest rate of 10% compounded monthly and a monthly payment of $850. (1) Calculate the principal. (2) How much of the principal is paid the first, 5th, 20th and last year? (3) How much interest is paid the first, 5th, 20th and last year year? (4) What is the total amount of money paid during the 30 years? (5) What is the total amount of interest paid during the 30 years? (6) What is...
Consider a 30-year mortgage with an interest rate of 10% compounded monthly and a monthly payment...
Consider a 30-year mortgage with an interest rate of 10% compounded monthly and a monthly payment of $850. (5) What is the total amount of interest paid during the 30 years? (6) What is the unpaid balance after 25 years? (7) How much has to be deposited into a savings account with an interest rate of 4% compounded quarterly in order to pay the unpaid balance of the mortgage after 25 years? (8) How much has to be deposited each...
You borrowed some money on a thirty-year mortgage at 3.5%, compounded monthly. Your payments are $950...
You borrowed some money on a thirty-year mortgage at 3.5%, compounded monthly. Your payments are $950 per month. How much will you pay in interest in the sixth year of this mortgage? Group of answer choices $6,565 $7,119 $7,299 $6,933 b) how much principal does the homeowner pay the first year? Group of answer choices $7,340 $4,060 $7,033 $4,835
Edward has a 30 year mortgage of $403,897. Edward qualifies for a 2.88% loan. Annual property...
Edward has a 30 year mortgage of $403,897. Edward qualifies for a 2.88% loan. Annual property taxes are $2,548 and annual insurance is $1,412/ Calculate Edward's PITI payment. Please show work. Thank you.
You have financed a house with a 30-year, monthly payable mortgage in the amount of $400,000...
You have financed a house with a 30-year, monthly payable mortgage in the amount of $400,000 at a fixed rate of 8% per year compounded monthly. a. What are your monthly mortgage payments? b. How much of the first month’s payment is accounted for by interest on your loan? c. To help pay off the mortgage early, you pay an extra $2000 with the 1st payment. How many payments will you need to make to pay off the remainder of...
Clark and Lana take a 30-year home mortgage of $122,000 at 7.2%, compounded monthly. They make...
Clark and Lana take a 30-year home mortgage of $122,000 at 7.2%, compounded monthly. They make their regular monthly payments for 5 years, then decide to pay $1200 per month. (a) Find their regular monthly payment. (Round your answer to the nearest cent.) $ (b) Find the unpaid balance when they begin paying the $1200. (Round your answer to the nearest cent.) $ (c) How many payments of $1200 will it take to pay off the loan? Give the answer...
You just bought a house and borrowed 15-year mortgage at 5% APR, compounded monthly. Your loan...
You just bought a house and borrowed 15-year mortgage at 5% APR, compounded monthly. Your loan amount is $250,000. Calculate your monthly payment Calculate the principal and interest portions of your 1st and last payment Calculate how much principal and interest you paid within 5 years and your outstanding balance at the end of the fifth year.
Consider a mortgage of $1,000,000. It has a 3.5% coupon paid monthly, maturity of 30 years,...
Consider a mortgage of $1,000,000. It has a 3.5% coupon paid monthly, maturity of 30 years, and a current price of 103.4375. What is the monthly yield of this mortgage? What is the bond equivalent yield? Show the formula used in calculating the yield.
1.) Find a house: House Price is ($350,000) 2.) Use interest rate of: 6% compounded monthly...
1.) Find a house: House Price is ($350,000) 2.) Use interest rate of: 6% compounded monthly for a 30 year loan and 5.5% compounded monthly for a 15 year loan. 3.) Determine how much a monthly principal and interest payment on your house would be if you financed it: a. for 30 years b. for 15 years c. for 30 years with 20% down d. for 15 years with 10% down 4.) How much would you pay for the home...
Bubba bought his house 20 years ago, he is borrowed $200,000 with a 30-year mortgage with...
Bubba bought his house 20 years ago, he is borrowed $200,000 with a 30-year mortgage with a 5.0% APR. His mortgage broker has offered him a 10-year mortgage with a 4% APR with 3 points closing costs. What is Charlie's old monthly payment? What is the balance on Bubba's mortgage? What is Bubba's new monthly payment? What are Bubba's present value savings after paying the points if he plans to live in the house until the mortgage is paid off?
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT