You are seeking a (30-year) ARM loan of $175,000 which will charge 3 points. Assuming you...
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You are seeking a (30-year) ARM loan of $175,000 which will charge 3 points. Assuming you keep this loan for 4 years, what are your CF's and the yield to lender (expressed as APR) ? What do you pay each year in interest? Initial rate 3.625% Annual adjustments - Tbill +2.25% (rounded to 1/8%) Max change of 2% per year interest rate Max interest of 5% above initial rate Tbill Index, now at 4.73, then changes annually to: 2.73, 5.82, 6.96 On separate paper complete your handwritten computations. This will probably require more than one page to show all of your work, including the table of cash flows you use to compute the Lender Yield. After completing your calculations summarize the results in the table given below. Be sure to turn in your handwritten calculations as well as the completed table shown below or you will receive zero for this assignment. Problem 2. After completing your calculations, summarize your results in the table below. Year Index Int. Rate Charged Amount Paid EOY Balance to Interest 1 2 4.73 2.73 3 5.82 4 6.96 Yield to Lender Monthly Payment % 3. You are seeking a (30-year) ARM loan of $350,000 which will charge 2 points. Assuming you keep this loan for 4 years, what are your CF's and the yield to lender (expressed as APR) ? What do you pay each year in interest? Initial rate 5.250% Annual adjustments - Tbill +2.50% (rounded to 1/8%) Max payment change of 10% per year (negative amortization allowed) Max interest of 6% above initial rate Tbill Index, now at 3.21, then changes annually to: 1.23, 5.92, 9.46 On separate paper complete your handwritten computations. This will probably require more than one page to show all of your work, including the table of cash flows you use to compute the Lender Yield. After completing your calculations summarize the results in the table given below. Be sure to turn in your handwritten calculations as well as the completed table shown below or you will receive zero for this assignment. 1 3.21 2 1.23 3 5.92 4 9.46 Yield to Lender Problem 3. After completing your calculations, summarize your results in the table below.. Amount Paid EOY Balance Year Monthly to Interest. Index Int. Rate Charged Payment % You are seeking a (30-year) ARM loan of $175,000 which will charge 3 points. Assuming you keep this loan for 4 years, what are your CF's and the yield to lender (expressed as APR) ? What do you pay each year in interest? Initial rate 3.625% Annual adjustments - Tbill +2.25% (rounded to 1/8%) Max change of 2% per year interest rate Max interest of 5% above initial rate Tbill Index, now at 4.73, then changes annually to: 2.73, 5.82, 6.96 On separate paper complete your handwritten computations. This will probably require more than one page to show all of your work, including the table of cash flows you use to compute the Lender Yield. After completing your calculations summarize the results in the table given below. Be sure to turn in your handwritten calculations as well as the completed table shown below or you will receive zero for this assignment. Problem 2. After completing your calculations, summarize your results in the table below. Year Index Int. Rate Charged Amount Paid EOY Balance to Interest 1 2 4.73 2.73 3 5.82 4 6.96 Yield to Lender Monthly Payment % 3. You are seeking a (30-year) ARM loan of $350,000 which will charge 2 points. Assuming you keep this loan for 4 years, what are your CF's and the yield to lender (expressed as APR) ? What do you pay each year in interest? Initial rate 5.250% Annual adjustments - Tbill +2.50% (rounded to 1/8%) Max payment change of 10% per year (negative amortization allowed) Max interest of 6% above initial rate Tbill Index, now at 3.21, then changes annually to: 1.23, 5.92, 9.46 On separate paper complete your handwritten computations. This will probably require more than one page to show all of your work, including the table of cash flows you use to compute the Lender Yield. After completing your calculations summarize the results in the table given below. Be sure to turn in your handwritten calculations as well as the completed table shown below or you will receive zero for this assignment. 1 3.21 2 1.23 3 5.92 4 9.46 Yield to Lender Problem 3. After completing your calculations, summarize your results in the table below.. Amount Paid EOY Balance Year Monthly to Interest. Index Int. Rate Charged Payment %
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Answer Problem 1 The monthly payment for a 30year ARM loan with an initial rate of 3625 an annual adjustment of Tbill 225 rounded to 18 and a maximum change of 2 per year interest rate is calculated a... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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