Determine value of mortgage

Assignment Help Financial Accounting
Reference no: EM1314108

Computation of value of mortgage.

Kim and Dan Bergholt are both government workers. They are considering purchasing a home in the Washington D.C. area for about $280,000. They estimate monthly expenses for utilities at $220, maintenance at $100, property taxes at $380, and home insurance payments at $50. Their only debt consists of car loans requiring a monthly payment of $350.

Kim's gross income is $55,000/year and Dan's is $38,000/year. They have saved about $60,000 in a money market fund on which they earned $5,840 last year. They plan to use most of this for a 20% down payment and closing costs. A lender is offering 30-year variable rate loans with an initial interest rate of 8% given a 20% down payment and closing costs equal to $1,000 plus 3 points.

Before making a purchase offer and applying for this loan, they would like to have some idea whether they might qualify.

Estimate the affordable mortgage and the affordable purchase price for the Bergholts.

Reference no: EM1314108

Questions Cloud

Evaluate the unit product cost of each product : Evaluate the unit product cost of each product for the current period using the activity-based costing approach and Computation of cost of the products based on Activity Based Costing
Determine diekow production''s direct labor rate : Calculation of Labor rate and efficiency variances - Using this information and the applicable information in E6, determine Diekow production's direct labor rate and efficiency variances for the year?
Calculation of material price and quantity variances : Calculation of Material price and quantity variances - Evaluate diekow production's direct materials price and quantity variances for the year
Present problems for the bergholts : Suppose they do qualify; what other factors might they consider before purchasing and taking out a home mortgage? and What future changes might present problems for the Bergholts
Determine value of mortgage : Computation of value of mortgage and Estimate the affordable mortgage and the affordable purchase price for the Bergholts.
Applications of combination : Applications of combination
Computing five key percentiles for data : Compute mean, standard deviation, coefficient of variation and 5 key percentiles for these data.
Expansionary and contractionary monetary policy : Discuss three automatic expenditures in the federal budget. What is the difference between discretionary fiscal policy and automatic stabilizers?
Estimate the correlation coefficient : Construct a scatter plot of P-RFM and P-HELM. If drawing the plot by hand, use graph paper to ensure accuracy.

Reviews

Write a Review

Financial Accounting Questions & Answers

  What are the major funds of your state or local government

What are the major funds of your state or local government

  Evaluate the under- or over-applied manufacturing overhead

Evaluate the under- or over-applied manufacturing overhead for 2012. Prorate the amount evaluated in based on the ending balances (before prorating) of Work in Process, Finished Goods, and Cost of Goods Sold.

  Determine the contribution margin income statement

Determine the contribution Margin Income statement and Redo the company contribution format income statement assuming that the company sells 1,400 units.

  Sinking fund payments for issue of bonds

Sinking fund payments for issue of bonds - What is the lowest level to which O'Dowell's EBIT can drop in the first year the bonds are issued without violating the covenants of the loan? O'Dowell's tax rate is 40%.

  Purpose bank reconciliation

Purpose bank reconciliation.  Use a format like the one shown on page 370, Illustration 8-12. For the Conference, you should show the adjusted cash balance,

  What value is greater accretion if she roll over traditional

Suppose the same facts as in part b., except that she earns a 3 percent after-tax rate of return on investments outside of the retirement accounts. $______value is GREATER accretion if she rolls over traditional into Roth IRA

  Log transformation

Log transformation when points do not seem to follow a straight line.

  Find the effect of the presence of a defense

Find the effect of the presence of a defense in connection with a negotiable instrument and Who is discharged if a holder strikes out a prior indorsement on a negotiable instrument?

  Influence the selection of measurement approach

Identify factors that will influence the selection of measurement approach

  Purpose a complete single-step income statement

Purpose a complete single-step income statement for the company and multiple-step income statement for the company (including gross margin, pretax income, and earnings per share)

  To accrue rent recognized but not yet received

By accessing this problem Assistance, you will learn while you earn points based on the Point Potential Policy set by your instructor.

  What is the depreciation expense on this asset

What is the depreciation expense on this asset and What is the depreciation expense for the second year on this asset?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd