Jonathan Monahan is purchasing a townhouse for $120,000. The down payment is 20 % , and the balance will be financed with a 15-year fixed-rate mortgage at 9 % and 3 discount points (each point is 1 % of the amount financed). When Jonathan signed the sales contract, he put down a deposit of $10,000, which will be credited to his down payment at the time of the closing. In addition, he must pay the following expenses: loan application fee, $100; property transfer fee, $190; title insurance premium, 3 4 % of amount financed; hazard insurance premium, $420; prepaid taxes, $310; and attorney’s fees, $500. a. Calculate the amount due from Jonathan at the closing. b. If the seller is responsible for the broker’s commission, which is 5 1 2 % of the purchase price, $670 in other closing costs, and the existing mortgage balance of $65,000, what proceeds will the seller receive on the sale of the property?

BuyFind

Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
Publisher: Cengage Learning
ISBN: 9781305585447
BuyFind

Contemporary Mathematics for Busin...

8th Edition
Robert Brechner + 1 other
Publisher: Cengage Learning
ISBN: 9781305585447

Solutions

Chapter 14.I, Problem 4TIE
Textbook Problem

Jonathan Monahan is purchasing a townhouse for $120,000. The down payment is 20 % , and the balance will be financed with a 15-year fixed-rate mortgage at 9 % and 3 discount points (each point is 1 % of the amount financed). When Jonathan signed the sales contract, he put down a deposit of $10,000, which will be credited to his down payment at the time of the closing. In addition, he must pay the following expenses: loan application fee, $100; property transfer fee, $190; title insurance premium, 3 4 % of amount financed; hazard insurance premium, $420; prepaid taxes, $310; and attorney’s fees, $500.

a. Calculate the amount due from Jonathan at the closing.

b. If the seller is responsible for the broker’s commission, which is 5 1 2 % of the purchase price, $670 in other closing costs, and the existing mortgage balance of $65,000, what proceeds will the seller receive on the sale of the property?

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Chapter 14 Solutions

Contemporary Mathematics for Business & Consumers
Ch. 14.I - Using Table 14-1 as needed, calculate the required...Ch. 14.I - Using Table 14-1 as needed, calculate the required...Ch. 14.I - 8. Marc Bove purchased a home with a $78,500...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - As one of the loan officers for Grove Gate Bank,...Ch. 14.I - Ben and Mal Scott plan to buy a home for $272,900....Ch. 14.I - 16. Michael Sanchez purchased a condominium for...Ch. 14.I - 17. Luis Schambach is shopping for a 15-year...Ch. 14.I - 18. Phil Pittman is interested in a fixed-rate...Ch. 14.I - 19. Larry and Cindy Lynden purchased a townhome in...Ch. 14.I - Heather Gott bought a home with an adjustable-rate...Ch. 14.I - Joe and Gloria Moutran art purchasing a house in...Ch. 14.I - 22. You are a real estate broker for Aurora...Ch. 14.II - Justin Schaefer owns a home that was recently...Ch. 14.II - Roman Bass cams a gross income of $3,100 per...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - For the following second mortgage applications,...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Calculate the housing expense ratio and the total...Ch. 14.II - Use Exhibit 14-4, Lending Ratio Guidelines, on...Ch. 14.II - 16. Ronald and Samantha Brady recently had their...Ch. 14.II - 17. The Barclays own a home that was recently...Ch. 14.II - Ransford and Alda Mariano own a home recently...Ch. 14.II - Michelle Heaster is thinking about building an...Ch. 14.II - Jamie and Alice Newmark have a combined monthly...Ch. 14.II - You are a mortgage broker at Interamerican Bank....Ch. 14.II - According to moncy.CNN.com. with mortguge rates...Ch. 14 - 1. Land, including permanent improvements on that...Ch. 14 - A(n) ___________ is a loan in which real property...Ch. 14 - Mortgage ___________ points are an extra charge...Ch. 14 - 4. A chart that shows the month-by-month breakdown...Ch. 14 - 5. A(n) ___________ account is a bank account used...Ch. 14 - Today most mortgage payments include four parts,...Ch. 14 - The final step in a real estate transaction is a...Ch. 14 - 8. The official document representing the right of...Ch. 14 - 9. List four mortgage loan closing costs. (14-4) Ch. 14 - A mortgage in which the interest rate changes...Ch. 14 - A home equity ___________ is a lump-sum second...Ch. 14 - A home equity ___________ of credit is a revolving...Ch. 14 - 13. Write the formula for the housing expense...Ch. 14 - Write the formula for the total obligations ratio....Ch. 14 - You are one of the branch managers of the Insignia...Ch. 14 - You are one of the branch managers of the Insignia...Ch. 14 - Suzanne Arthurs purchased a home with a $146,100...Ch. 14 - Use Table 14-1 to calculate the monthly principal...Ch. 14 - Use Table 14-1 to calculate the monthly principal...Ch. 14 - For the following second mortgage applications,...Ch. 14 - For the following second mortgage applications,...Ch. 14 - For the following second mortgage applications,...Ch. 14 - For the following mortgage applications, calculate...Ch. 14 - For the following mortgage applications, calculate...Ch. 14 - 11. As a loan officer using the Lending Ratio...Ch. 14 - 12. Dale Evans bought the Lazy D Ranch with an...Ch. 14 - 13. Diversified Investments purchased a 24-unit...Ch. 14 - Larry Mager purchased a ski lodge in Telluride for...Ch. 14 - 15. A Denny’s Restaurant franchisee is looking for...Ch. 14 - 16. How much more total interest will be paid on a...Ch. 14 - Adam Marsh is purchasing a $134,000 condominium...Ch. 14 - 18. Martin Ellingham is negotiating to buy a...Ch. 14 - 19. The Randolphs own a home that recently...Ch. 14 - 20. Jonathan and Kimberly Schwartz live in a home...Ch. 14 - 21. Phil Armstrong earns a gross income of $5,355...Ch. 14 - 22. Magda Leon is applying for a home mortgage...

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