Question

QUESTION 6 10 points Save Given the following information of the mortgage pool that backs a MPT (same as Question 34,5), what is the total cash flow of investors in month 1 of this security? Round your final answer to two decimals. • 30 year FRM, fully amortizing, monthly payments • Loans seasoned for 3 months before entering pool • WAM: 357 • WAC: 4% • Servicer/Guarantee fee: 0.55% • Starting pool balance: 250,342.967 • Prepayment assumption: 75% PSA

Answer 1

Answer Page.no © Total cash flue for month Total cash flo y month o incipal component payment is month is standing pool balance No. of years of mortage X No.of monthi) = $250, 342,967 30 years x 12 months = 250,342,967 360 = 695397.13 - Principal component payment in month 1 = $695397.13 Interest payments for 1 month starting pool balance X (WAC - guarantee fee) Total no. of months $250,34 2,967 x 4 12 months

250,342,967 *[0.04 -0.0055) logo 12 250342967 X 0.0345 12 86 368 32 362 12 719736.03 .:: Interest payment for 1 month $719436•03 Total caso flows for 1 month - Principal component payment --for month t interest payment for month = 695397.13 + +19736.03 = 1415133.16 .:: Total cash flows for 1 month = $1415133-16 in this, the mostage is a long term loan on a specific piece of property such as home or other realestate