A newly issue CMO's mortgage pool has a balance of $52.39 million with an average interest...
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A newly issue CMO's mortgage pool has a balance of $52.39 million with an average interest rate of 10.09% payable annually over a five-year term. There are two tranches. Priority payments will be made to Tranche A and will include the coupon, all amortization from the mortgage pool, and the interest that will be accrued to Tranche Z until Tranche A's principal is fully repaid. Tranche Z will accrue interest without any cash payments until the senior tranche is repaid. It will receive current interest and principal payments at that time. Tranche A has a principal balance of $26.78 million with an annual coupon of 6.73%. Tranche Z has a principal balance of $21.15 million with an annual coupon of 10.09%. What is Tranche A's capital balance at the end of year 1? A newly issue CMO's mortgage pool has a balance of $52.39 million with an average interest rate of 10.09% payable annually over a five-year term. There are two tranches. Priority payments will be made to Tranche A and will include the coupon, all amortization from the mortgage pool, and the interest that will be accrued to Tranche Z until Tranche A's principal is fully repaid. Tranche Z will accrue interest without any cash payments until the senior tranche is repaid. It will receive current interest and principal payments at that time. Tranche A has a principal balance of $26.78 million with an annual coupon of 6.73%. Tranche Z has a principal balance of $21.15 million with an annual coupon of 10.09%. What is Tranche A's capital balance at the end of year 1?
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calculate the Tranche As capital balance at the end of year 1 using the available information Coupon ... View the full answer
Related Book For
Real Estate Finance and Investments
ISBN: 978-0073377339
14th edition
Authors: William Brueggeman, Jeffrey Fisher
Posted Date:
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