His father has asked him to advise him on remortgaging the house (remortgaging means taking out a new loan to pay for the house, depending on the fact that the value of the house has risen and they give him a loan for a greater amount). The house was purchased about 8 years ago at an initial value of $140,000 and a rate of 5.5% per year compounded monthly for twenty years. When performing a revaluation of the house the market value is $185,000. Therefore, a bank offers him an offer of 5.25% annual capitalized weekly to pay off the outstanding debt of the house and 6.5% annual capitalized daily to cover debts that his father has in credit cards and loans, the term would be for a few 15 more years (both loans). His father has a debt in cards in the order of $45,000 and you want to know how much they would lend you to cover the cards, since due to market conditions they only offer you a maximum amount of 80% of the market value of the house.
His father has asked him to advise him on remortgaging the house (remortgaging means taking out a new loan to pay for the house, depending on the fact that the value of the house has risen and they give him a loan for a greater amount). The house was purchased about 8 years ago at an initial value of $140,000 and a rate of 5.5% per year compounded monthly for twenty years. When performing a revaluation of the house the market value is $185,000. Therefore, a bank offers him an offer of 5.25% annual capitalized weekly to pay off the outstanding debt of the house and 6.5% annual capitalized daily to cover debts that his father has in credit cards and loans, the term would be for a few 15 more years (both loans). His father has a debt in cards in the order of $45,000 and you want to know how much they would lend you to cover the cards, since due to market conditions they only offer you a maximum amount of 80% of the market value of the house.
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 28P
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solve the following problem:
His father has asked him to advise him on remortgaging the house (remortgaging means taking out a new loan to pay for the house, depending on the fact that the value of the house has risen and they give him a loan for a greater amount). The house was purchased about 8 years ago at an initial value of $140,000 and a rate of 5.5% per year compounded monthly for twenty years.
When performing a revaluation of the house the market value is $185,000. Therefore, a bank offers him an offer of 5.25% annual capitalized weekly to pay off the outstanding debt of the house and 6.5% annual capitalized daily to cover debts that his father has in credit cards and loans, the term would be for a few 15 more years (both loans).
His father has a debt in
cards in the order of $45,000 and you want to know how much they would lend you to cover the cards, since due to market conditions they only offer you a maximum amount of 80% of the market value of the house.
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