All of these have a balloon payment due at the end of the loan term EXCEPT a.a fully amortized loan. b.a term/straight loan. c.a partially amortized loan. d.an interest-only loan.
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All of these have a balloon payment due at the end of the loan term EXCEPT
a.a fully amortized loan.
b.a term/straight loan.
c.a partially amortized loan.
d.an interest-only loan.
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- Which of the following is true of a fully amortized loan? A. The amount of the payment applied to the principal remains the same during the loan period. B. Equal amounts of the payment are appiled to the principal Interest, taxes, and insurance. C. Additional payments applied to the interest during the loan period reduce the number of monthly payments required. D. Additional payments applied to the principal during the loan period reduce the number of monthly payments required(Note, this is how mortgage payments are calculated.) Payments on a loan are amortized when a fixed amount is paid at the end of each time period in order to pay off both the principle of the loan and the interest accumulated up to that point. At the end of each period, interest is charged on the amount still owing. Let P be the initial amount of the loan, and i > 0 be the interest rate charged (per period), R the size of the per period payment (paid at the end of each period), and Pt the amount that is still owed after t periods. So P0 = P(a) Find P1.(b) Find a first order linear recurrence for Pt.(c) Show that the solution to your recurrence relation isPt = (P-(R/i))(1+i)^t + (R/i)Which of the following statement is true of amortization? The computation of loan amortization is wholly based on the computation of simple interest. Amortization solely refers to the total value to be paid by the borrower at the end of maturity. The amortization schedule represents only the interest portion of the loan. The amortization schedule provides principal, interest, and unpaid principal balance for each month. In a typical loan amortization schedule: The amount of money paid towards reducing the loan balance decreases over time. The amount of interest paid each period does not remain constant. The amount of each payment does not remain constant. The amount of interest paid each period increases over time.
- Non-performing loans are defined as loans that: a. are either in default or close to being in default and are at least 90 days in arrears. b. have been written off and loans that are at least 80 days in arrears. c. are either in default or close to being in default and are at least 60 days in arrears. d. have been written off and loans that are at least 60 days in arrears.A borrower would pay more total interest on a 10-year loan under an equal principal payment plan than on the same loan amortized under an equal total payment plan. A. True B. FalseOver the duration of the loan, the total loan payment is... ... gradually increasing for "amortizing loans with fixed total payments". This statement is [ Select ] ["true", "false"] . ... gradually increasing for "amortizing loans with fixed principal payments". This statement is [ Select ] ["true", "false"] .
- To compute for the annual interest payments of a loan, the principal amount is multiplied by: a. Market rate b. Nominal rate c. Amortized rate d. Effective ratepls refer to the image attached, 1. suppose that you have the capacity to pay, would you rather borrow a loan that is amortized monthly, or one that is amortized quarterly? 2. what is your considerations when availing a loan? (quantitative or qualitative considerations) Discuss.The repayment of a loan in a series of equal periodic payments is called _____________. a. Amortization b. Mortgage c. Down payment d. Installment loan
- What would the loan payment amount and the interest payed for Kevan’s loan be if the PV=8500, PMT=495.74, FV=0, Rate=6.2, Period=18, Payment Frequency=12, and Compounding=monthlyWhat is the first step in calculating the lender's effective yield and calculating the borrower's effective cost of funds for loans? 1. Calculate the periodic loan payment based on the appraisal value. 2. Calculate the periodic loan payment based on the tax assessor's value. 3. Calculate the periodic payment based on the contract loan amount, nominal interest rate, and full amortization period. 4. All of the above.Choose the best answer from the choices provided. As a loan is paid off, the monthly payment increases debt and interest portions do not change each interest period interest potion of the fixed payment increases debt portion of the fixed payment increases
