ZuoTi.Pro
Question

You need a 15-year, fixed-rate mortgage to buy a new home for $250,000. Your mortgage bank...

You need a 15-year, fixed-rate mortgage to buy a new home for $250,000. Your mortgage bank will lend you the money at a 8.6 percent APR for this 180-month loan. However, you can afford monthly payments of only $850, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment.

Required: How large will this balloon payment have to be for you to keep your monthly payments at $850?

business   finance   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

Home nert Page Layout Formulas Data Review View dd-Ins Cut Σ AutoSum Wrap Text aCopy B า 프 . Ej-., Δ. : r_一 逻锂函Merge & Center. $, % , 弼,8 Paste Conditional Format CeInsert Delete Format Formatting, as Table w styles. ▼ ㆆ ▼ Sort &Find & 2 ClearFe Select Edting Format Painter Clipboard Alignment Number Cells N390 377 378 379 380 381 382 383 384 385 386 387 388 389 390 391 392 393 394 395 LOAN RATE RATE PER MONTH NO OF MONTHS PMT 250000.00 8.6% 0.716667% 180 850.00 YOU CAN PAY 850 PER MONTH LOAN AMOUNT AS PER 850 PER MONTH LOAN AMOUNT 85805.71 [EXCEL-PV(1380,1381,-1382)] DIFFERENCE 164194.29 [-1378-1385] NOW WE HAVE TO CALCULATE FUTURE VALUE OF THIS EXTRA SUM BORROWED FUTURE VALUE 593744.97 [EXCEL-FV(1380,1381,,-1388)] SO BALOON PAYMENT WILL BE 593744.97 제 トト11 CALCULATOR | LOAN OPTIONS fv. ann CAP STRU VALUE BOX DILUTION DOLLAR COST AVGMORTGAGE EXPO Sheeti Sheet2 ShelI 05:39Home nert Page Layout Formulas Data Review View dd-Ins Σ AutoSum Cut ー E ゴWrap Text Sort &Find & Conditional Format CeInsert Delete Format Formatting, as Table w styles. ▼ ㆆ ▼ ta copy ▼ в 1 프 . Ej-., Δ. : rーー 逻锂函Merge & Center. $, % , 弼,8 C 2 ClearFe Select Edting Paste Format Painter Cells Number Alignment Clipboard L406 395 396 397 398 399 400 401 402 403 404 405 406 407 408 409 410 411 412 413 WE CAN HAVE ONE MORE METHOD TO SOLVE THIS PMT YOU CAN PAY DIFFERENCE 2476.53 [EXCEL PMT (1380, 1381,-1378)] 850 1626.53 NOT PAID WE HAVE TO CALCULATE FUTURE VALUE OF ANNUITY OF THIS DIFFERENCE FUTURE VALUE 593744.97 [EXCEL FV(1380,1381,-1399)] 593744.97 SO BALOON PAYMENT WILL BE- BOX DILUTION DOLLAR COST AVGMORTGAGE EXPO Sheeti Sheet2 ShelI fv. ann CAP STRU VALUE 福 130% 제 トト11 CALCULATOR | LOAN OPTIONS 05:39

0 0
Add a comment
Know the answer?
Add Answer to:
You need a 15-year, fixed-rate mortgage to buy a new home for $250,000. Your mortgage bank...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • You need a 30-year, fixed-rate mortgage to buy a new home for $220,000. Your mortgage bank...

    You need a 30-year, fixed-rate mortgage to buy a new home for $220,000. Your mortgage bank will lend you the money at a 8.6 percent APR for this 360-month loan. However, you can afford monthly payments of only $900, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at...

  • You need a 25-year, fixed-rate mortgage to buy a new home for $190,000. Your mortgage bank...

    You need a 25-year, fixed-rate mortgage to buy a new home for $190,000. Your mortgage bank will lend you the money at a 7.6 percent APR for this 300-month loan. However, you can afford monthly payments of only $1,000, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at...

  • You need a 20-year, fixed-rate mortgage to buy a new home for $240,000. Your mortgage bank...

    You need a 20-year, fixed-rate mortgage to buy a new home for $240,000. Your mortgage bank will lend you the money at a 6.1 percent APR for this 240-month loan. However, you can afford monthly payments of only $800, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at...

  • 7. You need a 25-year, fixed-rate mortgage to buy a new home for $210,000. Your mortgage...

    7. You need a 25-year, fixed-rate mortgage to buy a new home for $210,000. Your mortgage bank will lend you the money at a 8.1 percent APR for this 300-month loan. However, you can afford monthly payments of only $900, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. Required: How large will this balloon payment have to be for you to keep your monthly...

  • Problem 4-38 Calculating Loan Payments You need a 35-year, fixed-rate mortgage to buy a new home...

    Problem 4-38 Calculating Loan Payments You need a 35-year, fixed-rate mortgage to buy a new home for $260,000. Your mortgage bank will lend you the money at an APR of 5.55 percent for this 420-month loan. However, you can only afford monthly payments of $1,000, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you...

  • TVM

    You need a 30-year, fixed-rate mortgage to buy a new home for $220,000. Your mortgage bank will lend you the money at a 6.8 percent APR for this 360-month loan. However, you can afford monthly payments of only $1,100, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. How large will this balloon payment have to be for you to keep your monthly payments at...

  • 3. (5 points) You are a graduate student and planning to save for retirement over the...

    3. (5 points) You are a graduate student and planning to save for retirement over the next 30 account. The return of the stock account is expected to be 10 percent, will pay 6 percent. When you retire, you will combine your percent return. How much can you withdraw each month from your account assuming year withdrawal period? bond and the bond account account with an 8 a 30- money into an 5 points) Steve needs a 30-year, fixed-rate mortgage...

  • E. $24.20 Fou are paying an effective annual rate of 20 percent on your credit card....

    E. $24.20 Fou are paying an effective annual rate of 20 percent on your credit card. The interest is compounded quarterly. What is the annual percentage rate on this account (calculate the APR using the effective quarterly rate)? A. 17.50 percent B. 18.00 percent C. 18.65 percent D. 18.98 percent E. 19.50 percent 14. The present value of the following cash flow stream is $5.933.86 when discounted at 6 percent annually. What is the value of the missing cash flow?...

  • E. $24.20 Fou are paying an effective annual rate of 20 percent on your credit card....

    E. $24.20 Fou are paying an effective annual rate of 20 percent on your credit card. The interest is compounded quarterly. What is the annual percentage rate on this account (calculate the APR using the effective quarterly rate)? A. 17.50 percent B. 18.00 percent C. 18.65 percent D. 18.98 percent E. 19.50 percent 14. The present value of the following cash flow stream is $5.933.86 when discounted at 6 percent annually. What is the value of the missing cash flow?...

  • Assume that you have a 30 year fully-amortized fixed rate mortgage for your home. Your loan...

    Assume that you have a 30 year fully-amortized fixed rate mortgage for your home. Your loan amount is $300,000 with a 3% annual interest rate. After 28 years, you would like to sell the property. What is your loan balance at the end of 28 years? Assume that you have a 30 year fully-amortized fixed rate mortgage for your home. Your loan amount is $300,000 with a 3% annual interest rate and your balloon payment is $50,000. What is your...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT