DATA GIVEN FOR THE OLD LOAN AND THE NEW LOAN RUSH RUSH FINANCE ....PERSONAL Marginal tax...
DATA GIVEN FOR THE OLD LOAN AND THE NEW LOAN
RUSH RUSH FINANCE ....PERSONAL Marginal tax rate 6% Resale Plan (Months) 60 MORTGAGE TERMS Original Mortgage Amount $150,000.00 Current Mortgage Rate 5.75% Original Term (Years) 20 Months Paid 117 New Mortage Rate 3.00% New Term (YEARS) 15 Points 0 REFINACING FEES Application $200.00 Title $2,000.00 Legal $200.00 Other $10,779.85 Points 0 Total Fees $13,179.85 ANALYSIS CURRENT PROPOSED Mortgage Amount 97, 703.26 $97,703.26 ANALYSIS Mortgage Payment Months to Recover Refinancing cost Mortage Balance at Resale (Valor Presente del MA - c26 Principal Repaid to Resale ( - MA - MBAR = c26 c29) Total Payments to Resale Total Interest to Resale Tax Deduction on Interest Net Interest Costo to Resale Interest Savings (COSTS) TOTAL SAVINGS COST (COSTS)
COURSE : FINANCE: INCLUDED DATA FOR OLD LOAM AND NEW LOAN TO RECALCULATE MORTGAGE PAYMENTS ETC
| PERSONAL | |
| MARGINAL TAX RATE | 6% |
| RESALE PLAN (MONTHS) | 60 |
| MORTGAGE TERMS | |
| ORIGINAL MORTGAGE AMOUNT | $150,000.00 |
| CURRENT MORTGAGE RATE | 5.75% |
| ORIGINAL TERM (YEARS) | 20 |
| MONTHS PAID | 117 |
| NEW MORTGAGE RATE | 3.00% |
| NEW TERM (YEARS) | 15 |
| POINTS | 0 |
| REFINANCING FEES | |
| APPLICATION | $200.00 |
| TITLE | $2,000.00 |
| LEGAL | $200.00 |
| OTHER | $10,779.85 |
| POINTS | 0 |
| tOTAL FEES | $13,179.85 |
| ANALYSIS | CURRENT | PRPOSED |
| NORTGAGE AMOUNT | $97,703.26 | $97,703.26 |
| ANALYSIS | FOR THE NEW LOAN : FIND |
| MORTGAGE PAYMENT | |
| MONTHS TO RECOVER REFINANCING COST | |
| MORTGAGE BALANCE AT RESALE (PRESENT VALUE) | |
| PRINCIPAL REPAID TO RESALE | |
| TOTAL PAYMENTS TO RESALE | |
| TOTAL INTEREST TO RESALE | |
| TAX DEDUCTION ON INTEREST | |
| NET INTEREST COST TO RESALE | |
| INTEREST SAVINGS (COSTS) | |
| TOTAL SAVINGS COST | |
Homework Answers
Soln :
| ANALYSIS | For New loan |
| MORTAGE AMOUNT | 97703.26 |
| MORTGAGE PAYMENT | 674.72 |
| MONTHS TO RECOVER REFINANCING COST | 180 |
| MORTGAGE BALANCE AT RESALE (PRESENT VALUE) | 69865 |
| PRINCIPAL REPAID TO RESALE | 27838.26 |
| TOTAL PAYMENTS TO RESALE | 40483.2 |
| TOTAL INTEREST TO RESALE | 12644.94 |
| TAX DEDUCTION ON INTEREST | 758.70 |
| NET INTEREST COST TO RESALE | 11886.24 |
| INTEREST SAVINGS (COST) | 10749.76 |
| TOTAL SAVINGS COST | 13179.85 |
Please refer the table, here we have calculated mortgage payment for new loan a sPMT (3%/12,180,-97703.26,0) = 674.72
Total payments to resale that is at 60 months = 674.72*60
Also, we have calculated the interest cost for 60 months for old loan adding interest of each month .
Use Excel to calculate PMT, principal paid, interest and principal remaining, you will get these values for both old and new loan
Interest of previous loan = 22636 and hence interest cost savings = 22636 - interest paid on new loan = 22636-11886 = 10749
Total savings cost = Interest savings - total fee = 10749 - 13180 = -2431
Add Answer to:
DATA GIVEN FOR THE OLD LOAN AND THE NEW LOAN
RUSH RUSH FINANCE ....PERSONAL Marginal tax...
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