Homework Answers
24: Additional deduction on rent payment over interest = 2200-1800 = 400
Additional Tax savings per month = 400*20% = 80
25: Difference in payments = 1970-1150 = 820
Number of months required = 5400/820 = 6.59 or 7 months
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24 and 25
24) TAX SAVINGS. If the rent on an apartment is $2200 per month,...
You are in the 25 %tax bracket. The apartment rents for $ 1600 per month. Your...
You are in the 25 %tax bracket. The apartment rents for $ 1600 per month. Your monthly mortgage payments would be $1900, of which an average of $1600 per month goes toward interest during the first year. Determine whether renting or buying is cheaper in terms of monthly payments during the first year. Assume you are itemizing deductions. Is it cheaper to own or to rent?
You are in the 25% tax bracket. The apartment rents for $1200 per month. Your monthly...
You are in the 25% tax bracket. The apartment rents for $1200 per month. Your monthly mortgage payments would be $1700, of which an average of $1400 per month goes toward interest during the first year. Determine whether renting or buying is cheaper in terms of monthly payments during the first year. Assume you are itemizing deductions. Is it cheaper to own or to rent? It is cheaper to rent. It is cheaper to own.
2. If you can afford an $1150 per month mortgage, how much house can you afford...
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A family currently live in an apartment whose monthly rent is $950. They are thinking of buying a house which would cost...
A family currently live in an apartment whose monthly rent is $950. They are thinking of buying a house which would cost $220,000. They plan to live in this house for 5 years and sell it at the end of the 5th year. They would put a downpayment of $20,000 and finance the balance through a mortgage at 3.5% interest rate. The mortgage is to be repaid in 5 annual installments (which include both principal and interest) at the end...
(18) You own an apartment complex with 40 units. All units are occupied. The monthly rent...
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1) (3 pts) Bob would like to have a total savings of $30,000 in 6 years...
1) (3 pts) Bob would like to have a total savings of $30,000 in 6 years to use as a down payment on a future house purchase. He has no money saved up now, but plans on depositing $350 per month at the end of every month to save for this goal. What is the periodic interest rate Bob must earn to reach his goal? What is the Annual Percentage rate? 1 Periodic *.ㅡ I Nominal (APR)- % 2) (3...
Question 1 4 pts You decide to buy a 60 unit apartment complex in Austin for...
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James Hunt’s Dream Apartment Part 1 James Hunt currently earns a yearly salary of $100,000 (paid...
James Hunt’s Dream Apartment Part 1 James Hunt currently earns a yearly salary of $100,000 (paid on a monthly basis at the end of each month) and his average income tax rate is 25% (taxes are withheld by the employer from the employee’s gross monthly pay). He wishes to buy an apartment in Boston. He can obtain from his bank a 30-year fixed rate mortgage loan at a nominal interest rate of 4.75% per annum, with equal monthly payments paid...
Suppose your friend April is considering to refinance her mortgage. She bought her house 60 months...
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Part II -Mortgage Refinance Suppose your friend April is considering to refinance her mortgage. She bought...
Part II -Mortgage Refinance Suppose your friend April is considering to refinance her mortgage. She bought her house 60 months ago. The amount of loan equals 154,000. She paid cash to cover the 5% down payment plus all required closing costs (closing costs include application fee, appraisal fee, loan origination fees and other costs, usually about 3%-5% of the loan amount). Since she had a decent credit history and relatively stable income, her mortgage rate was 5.25% for 30 years...
You are in the 25% tax bracket. The apartment rents for $1200 per month. Your monthly mortgage payments would be $1700, of which an average of $1400 per month goes toward interest during the first year. Determine whether renting or buying is cheaper in terms of monthly payments during the first year. Assume you are itemizing deductions. Is it cheaper to own or to rent? It is cheaper to rent. It is cheaper to own.
2. If you can afford an $1150 per month mortgage, how much house can you afford with a 5% annual rate on 30 year mortgage with a 20% down payment?
(18) You own an apartment complex with 40 units. All units are occupied. The monthly rent for 15 units is $1,100 per unit, and the monthly rent of the other 25 units is $1,400 per unit. The total maintenance cost is $3,000 per month for the entire complex. The property tax is $200 per month for the entire complex. Assume there are no other costs and also no changes in the rent, the maintenance cost, and the tax. The units...
1) (3 pts) Bob would like to have a total savings of $30,000 in 6 years to use as a down payment on a future house purchase. He has no money saved up now, but plans on depositing $350 per month at the end of every month to save for this goal. What is the periodic interest rate Bob must earn to reach his goal? What is the Annual Percentage rate? 1 Periodic *.ㅡ I Nominal (APR)- % 2) (3...
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Suppose your friend April is considering to refinance her mortgage. She bought her house 60 months ago. The amount of loan equals 154,00. She paid cash to cover the 5% down payment plus all required closing costs (closing costs include application fee, appraisal fee, loan origination fees and other costs, usually about 3%-5% of the loan amount). Since she had a decent credit history and relatively stable income, her mortgage rate was 5.25% for 30 years at the time of...
Part II -Mortgage Refinance Suppose your friend April is considering to refinance her mortgage. She bought her house 60 months ago. The amount of loan equals 154,000. She paid cash to cover the 5% down payment plus all required closing costs (closing costs include application fee, appraisal fee, loan origination fees and other costs, usually about 3%-5% of the loan amount). Since she had a decent credit history and relatively stable income, her mortgage rate was 5.25% for 30 years...
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