CH 4 Problems, Finance Basics

Homework Chapter 4
A mortgage loan in the amount of $100,000 is made at 12% interest for 20 years. Payments are to be monthly in each part of this problem.
a. What will monthly payments be if:
1. The loan is fully amortizing?
2. It is partially amortizing and a balloon payment of $50,000 is scheduled at the end of year 20?
3. It is a nonamortizing or interest only loan?
4. It is a negative amortizing loan and the loan balance will be $150,000 at the end of year 20?
b. What will the loan balance be at the end of year 5 under parts a (1) through a (4)?
c. What would be the interest portion of the payment scheduled for payment at the end of month 61 for each case (1) through (4) above?
d. Assume that the lender charges 3 points to close the loans in parts a (1) through a (4). What would be the APR for each?
e. If the loan is prepaid at the end of year 5, what will be the effective rate of interest for each loan in parts a (1) through a (4)?
Posted Date: 9/11/2012 1:06:26 PM | Location : United States







Related Discussions:- CH 4 Problems, Assignment Help, Ask Question on CH 4 Problems, Get Answer, Expert's Help, CH 4 Problems Discussions

Write discussion on CH 4 Problems
Your posts are moderated
Related Questions
How to calculate the present value of assignment??

if you won the publisher''s clearing house $10 million prize (payable as 30 pmts of $250,000 and $2.5m in yr. 30) and could invest the money at 8%, would you accept an offer of $3.

Explain the meaning of Gross and Net Yield While gross yield refers to the yield realized by investor before paying taxes, net yield is what remains with him after paying th

Discuss the applicabilty of an operating cycle to poultry business(consider broilers)

Consider the following capital market yielding 1% per year and a mutual fund consisting of 60% stocks and 40% bonds. expected return of stocks 9.75% per year and expected return on

Reasons for Different Interest Rate Interest rates may differ in different market and market segment since: i) Size of the loan: Deposits above specific amounts into the

Solution to the Agency Conflict The government can acquire the following actions to protect itself and its interests. 1. Acquire monitoring costs E.g. the gover

J inherited 30000 & decides to open a hair salon.make arrangements 1/4/1016 commits 10000 to the business Opens an a/c under j hair salon What will be the amount under capital in

Question 1: a) Explain the framework put forward by the Basel Committee to ensure that banks and supervisors give appropriate attention to the second (supervisory review) and

should be provied on a centralised or a decentralised basic?