Jackson is looking to purchase a condo. He is looking to have a conventional mortgage as he does not want to pay for mortgage default insurance. The new condo units that he is interested in are on the market for $132,000. How long will it take Jackson to save for the 20% down payment, if interest is at 6.75% compounding monthly with monthly savings of $371? 48 months B 36 months C 24 months D 60 months E 72 months

Jackson is looking to purchase a condo. He is looking to have a conventional mortgage as he does not want to pay for mortgage default insurance. The new condo units that he is interested in are on the market for $132,000. How long will it take Jackson to save for the 20% down payment, if interest is at 6.75% compounding monthly with monthly savings of $371? 48 months B 36 months C 24 months D 60 months E 72 months

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Tim wants to buy an apartment that costs $750,000 with an 85% LTV mortgage. Tim got a 30 year, 3/1 ARM with an initial teaser rate of 3.75%. The reset margin on the loan is 300 basis points above 1 year CMT. In year 4, the index resets to 3.50%. What will his new mortgage payment be in year 4? (Write the answer as a number rounded to two decimals (e.g. if you get $50,66666, write 50.67).
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Please answer all subparts with explanation. I know it's not according to your guidelines. Thanks I will really upvote
A couple visits an open house and fall in love with the floor plan and location. They tell the host they would love to buy the house but do not know if they can afford it. In the conversation, the broker learns that they are currently paying $1750 per month for rent. Would the principal and interest payments be within the amount of their current rent if the price is $249,000 with interest rates for a zero down, 30 years mortgage at 5% interest? Note: 30 years of 5% interest is $5.37. A. Only if they have a 20% down payment. B. No, the payment is more than their current rent amount C. There is not enough information to determine an answer D. Yes, the payment is within the range of their current rent amount.
You have two goals for which you want to save both relating to a home purchase. You have decided to start a savings plan. First, you want to purchase your new $500,000 home in eight years. Your first goal is to have $100.000 saved for a down payment and you will finance the rest with a 30-year, 6% APR conventional simple amortized mortgage. Secondly, you also want to pay off the home 15 years after purchase, but you do not want to be committed to a higher 15-year mortgage payment. So, separate from making your monthly payment, your second goal is you want to save enough money to make a final, lump-sum payment, sent as payment nunber 181, to pay off the balance remaining at that time. You want to invest on a monthly basis beginning one month from now and ending when you pay off the mortgage, as one continuous annuity. Assume you can earn 8% EAR on your investment. Calculate the monthly savings contribution required to meet your two goals.
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Show Your Work Brian just purchased a home for $300,000 and made the required down payment of 20% ($60,000) to avoid PMI. Therefore, he is financing $240,000 over 30 years (360 months) at 3%. A) How much are his payments on the loan? B) His husband, Greg, is a great financial planner and says it would be very prudent to pay an EXTRA $200 per month on the mortgage payments. How many monthly payments will this “knock off” or reduce on the original 360 payments? How much interest will be saved over the life of the loan by making the extra $200 per month payment?

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