What is difference between rate cap and debt service cap

Assignment Help Financial Management
Reference no: EM131322458

1.Most ARMs have rate caps and/or debt service caps. What’s the difference between a rate cap and a debt service cap?

2. In general, why do lenders front load fees and points rather than amortizing them over the life of a loan?

3. Name three cash expenditures incurred by a property owner that are not included in a calculation of Net Operating Income (NOI).

Reference no: EM131322458

Questions Cloud

Construct a simple frequency distribution of scores : Construct a simple frequency distribution of these scores.- Construct a grouped frequency distribution of these scores that includes both frequencies and relative frequencies.
Examine ways that cultural expressions influence your life : Examine the ways that cultural expressions influence your daily life. You are welcome to use images in this Assignment, however, the written content needs to be at least 750 words
Summarize an article of company that has undergone strategy : The Strategic Change Model suggests an organization needs to be aligned in three systems: technical, political, and cultural. For your initial post in this module's discussion, locate and summarize an article about a company that has undergone str..
What changes could make to increase your energy efficiency : What changes could you make to decrease your energy use? What changes could you make to increase your energy efficiency? Which changes will be most difficult for you to implement? Why do you think so?
What is difference between rate cap and debt service cap : Most ARMs have rate caps and/or debt service caps. What’s the difference between a rate cap and a debt service cap?  In general, why do lenders front load fees and points rather than amortizing them over the life of a loan? Name three cash expenditur..
Explain the evolution of rti and its purpose : Introduce the Response to Intervention (RTI) program and the School-wide Positive Behavior Support (SWPBS) program to the School Board members by defining these programs. Explain the evolution of RTI and its purpose and Explain how RTI meets IDEA 2..
Identify a need for change in a company or organization : Walmart is one of the largest companies in America; it has solidified its position as the biggest retailer in America and the world over with several branches all around the globe. Walmart prides itself in affordable products for everyday American..
The correlation between self esteem and shyness : The correlation between self-esteem and shyness is -.50. Interpret this correlation.- Which is larger-a correlation of +.45 or a correlation of -.60? Explain.
Reflects a positive or a negative correlation : Tell whether each of the given relationships reflects a positive or a negative correlation the amount of stress in people's lives and the number of colds they get in the winter.

Reviews

Write a Review

Financial Management Questions & Answers

  What is the net present value of the project

Ford Motors expects a new hybrid-engine project to produce incremental cash flows of $100 million each year and expects these to grow at 4% each year. The upfront project costs are $900 million and Ford's weighted average cost of capital is 9%. If th..

  Make improvements in its working capital management

The company wants to make improvements in its working capital management. At present, the firm has credit sales of P1,200,000, the collection period is 60 days, and the cost is 80% of the sales price. Compute the (a) Average Accounts Receivale and (b..

  Does their treatment differ for tax purposes

Distinguish between interest income and dividend income. Does their treatment differ for tax purposes?- List the four classifications of deductible medical expenses. Are your total medical expenses deductible?

  Preferred stock valuation

(Preferred stock valuation) Pioneer's preferred stock is selling for $45 in the market and pays a $2.70 annual dividend.  If the market's required yield is 7 percent, what is the value of the stock for that investor? The value of the stock for the in..

  The stock price after the recap

Lee Manufacturing's value of operations is equal to $540.00 million after a recapitalization (the firm had no debt before the recap). Lee raised $238.00 million in new debt and used this to buy back stock. Lee had no short-term investments before or ..

  Respective businesses produce earnings before interest

Adams operates his $30000 firm using his own equity. Bob operates his firm with $15000 of his own money plus $15000 of debt at a cost of 12 percent interest. Calculate Adams's and Bob's return on equity if their respective businesses produce earnings..

  What is dollar amount of dividends

Lee purchased a stock one year ago for $25. The stock is now worth $33, and the total return to Lee for owning the stock was 0.38. What is the dollar amount of dividends that he received for owning the stock during the year?

  What are the components of the nominal interest rate

What are the components of the nominal interest rate? What does each component pay for - WHat is an Investment Banker? What does he do? Why would a company use one?

  Statements regarding the efficient market hypothesis

Which of the following statements regarding the efficient market hypothesis (EMH) is incorrect?

  Understanding of the concept of cost capital

Based on your understanding of the concept of cost capital, which of the following statements are valid?

  Currently pay dividend-stock currently worth

Netscrape Communications does not currently pay a dividend. You expect the company to begin paying a $2.4 per share dividend in 14 years, and you expect dividends to grow perpetually at 3.4 percent per year thereafter. If the discount rate is 10 perc..

  What is proper cash flow amount to use as initial investment

Kenny, Inc., is looking at setting up a new manufacturing plant in South Park. The company bought some land six years ago for $7.7 million in anticipation of using it as a warehouse and distribution site, but the company has since decided to rent fac..

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