Ann gets a 30 year 1/1 Fully Amortizing ARM for $1,000,000, with monthly payments and monthly compounding. The initial rate is 3%. In the future, the rate will reset to 250 basis points above the LIBOR. There are no rate caps or floors. Suppose at the first reset, the LIBOR was 6%. What is the monthly mortgage payment for the second year?"
USING FINANCIAL CALCULATOR
Step 1: Monthly payment initially
N=12*30
I/Y=3%/12
PV=-1000000
FV=0
CPT PMT=4216.0403372945
Step 2: Loan balance after 1st year
N=12*1
I/Y=3%/12
PV=-1000000
PMT=4216.0403372945
CPT FV=979121.996415604
Step 3: New monthly payment
N=12*29
PV=-979121.996415604
I/Y=(6%+2.5%)/12
FV=0
CPT PMT=7585.94797296199
USING EXCEL
=-PMT((6%+2.5%)/12,12*29,FV(3%/12,12*1,PMT(3%/12,12*30,-1000000),-1000000))
=7585.95
Ann gets a 30 year 1/1 Fully Amortizing ARM for $1,000,000, with monthly payments and monthly...
Ann got a 15 year Fully Amortizing FRM for $1,000,000 at an annual interest rate of 7% compounded monthly, with monthly payments. After 5 years of payments, Ann can refinance the balance into a 10 year Fully Amortizing FRM at an annual interest rate of 5.25% compounded monthly, with monthly payments. If Ann refinances into this 10 year loan, what will be her monthly savings on her mortgage payment? "
Ann wants to buy an office building which costs $1,000,000. She obtains a 30 year fully amortizing fixed rate mortgage with 80% LTV, an annual interest rate of 4%, with monthly compounding and monthly payments. The mortgage has a 2% prepayment penalty if the borrower prepays in the first 5 years. Suppose Ann makes the required monthly payment for 3 years and prepays after her final monthly payment at the end of 3 years. What is the annualized IRR on...
Ann got a 30 year Fully Amortizing FRM for $1,000,000 at an annual interest rate of 8% compounded monthly, with monthly payments. After 5 years of payments, Ann can refinance the balance into a 25 year Fully Amortizing FRM at an annual interest rate of 5% compounded monthly, with monthly payments. Refinancing will cost Ann 2 points and $1,500 in closing costs. If Ann refinances into this loan after 5 years, what will be her total cost of refinancing?"
Ann is looking for a fully amortizing 30-year Fixed-Rate Mortgage with monthly payments for $3,200,000. Mortgage A has a 4.38% interest rate and requires Ann to pay 1.5 points upfront. Mortgage B has a 6% interest rate and requires Ann to pay zero fees upfront. Assuming Ann makes payments for 30 years, what is Ann’s annualized IRR from mortgage B?
6. Ann obtains a fully amortizing 30 year Fixed Rate Mortgage with monthly payments for $1,250,000 at 4.38%. What fraction of Ann's 40th payment goes to interest? Write your answer in percent, without the % sign.
A bank makes a 30 year Fully Amortizing FRM for $1,000,000 at an annual interest rate of 4.13% compounded monthly, with monthly payments. Suppose inflation is 2% per year, compounded monthly. What is the real value of the 20th payment?"
A bank makes a 30 year Fully Amortizing FRM for $1,000,000 at an annual interest rate of 4.13% compounded monthly, with monthly payments. What is the market value of this loan after 7 years of payments if the annual interest rate for this loan is 10% compounded monthly?"
Assume that a lender offers a 30-year, $150,000 adjustable rate mortgage (ARM) with the following terms: Initial interest rate 7.5 percent Index one-year Treasuries Payments reset each year Margin 2 percent Interest rate cap 1 percent annually; 3 percent lifetime Discount points 2 percent Fully amortizing; however, negative amortization allowed if interest rate caps reached Based on estimated forward rates, the index to which the ARM is tied is forecasted as follows: Beginning of year (BOY) 2=7 percent; (BOY) 3=8.5...
A bank makes a 30 year Fully Amortizing FRM for $1,000,000 at an annual interest rate of 4.25% compounded monthly, with monthly payments. What is the market value of this loan after 7 years of payments if the annual interest rate for this loan is 7% compounded monthly? How would this be done on a BA II calculator???
show the work on a calculator A borrower takes-out a fully amortizing loan for $1,000,000. The term of the loan is 30 years. The initial interest is 6% APR, compounded monthly. After one year, the interest rises to 8% APR, compounded monthly. After two years, the interest falls back to 6% APR, compounded monthly. After three years, the interest further falls to 4% APR, and it remains at 4% APR for the rest of the loan term Part A What...