Question

Assume that you have found a home for sale and have agreed to a
purchase price of $254800$254800.

**Down Payment:** Assume that you are going to make a
10%10% down payment on the house. Determine the amount of your down
payment and the balance to finance.

Down Payment=$Down Payment=$

Loan Amount=$Loan Amount=$

**Monthly Payment:** Calculate the monthly payment for
a 30 year loan (rounding to the nearest cent, so rounding to two
decimal places). For the 30 year loan use an annual interest rate
of 4.27%4.27%.

First, express the annual interest rate as a decimal.

The annual interest rate expressed as a decimal isThe annual
interest rate expressed as a decimal is .

Now use the loan formula to find the monthly payment, dd. The loan
formula solved for dd is:

d=P0(rk)(1−(1+rk)−Nk)d=P0(rk)(1-(1+rk)-Nk)

P0P0 is the original loan amount.

rr is the annual interest rate in decimal form.

kk is the number of compounding periods in one year (so
k=12k=12).

NN is the length of the loan in years.

Monthly Payment:d=$Monthly Payment:d=$

Assuming you make the monthly payment each month for 30 years, what
will be the total amount repaid?

Total payments=$Total payments=$

Find the total amount of interest paid over the 30 years. To do so,
subtract the amount originally borrowed from the total
payments.

Total interest paid=$Total interest paid=$

**Calculate your Income:** As already mentioned, these
payments are for principal and interest only. You will also have
monthly payments for home insurance and property taxes, but for
this lab you will ignore those. In addition, it is necessary to
have income leftover for other expenses like electricity, water,
food, and other bills. As a wise home owner, you decide that your
monthly principal and interest payment should not exceed 35% of
your monthly take-home pay so that you have plenty left over for
those other expenses.

What minimum monthly take-home pay (i.e. your monthly pay checks
after taxes) should you earn in order to meet this goal? In other
words, 35% of what monthly take-home pay is equal to your mortgage
payment?

Minimum monthly take-home pay=$Minimum monthly take-home
pay=$

It is also important to note that your net or take-home pay (after
taxes) is less than your gross pay (before taxes). Assuming that
your net pay is 73% of your gross pay, use your monthly take-home
pay to find the minimum gross monthly salary will you need to
afford this house.

Minimum monthly gross pay=$Minimum monthly gross pay=$

Now find the minimum annual gross pay you will need to afford this
house.

Minimum annual gross pay=$Minimum annual gross pay=$

Answer #1

Purchase price | $254,800 |

Down Payment | 10% |

Down Payment |
$25,480 |

Loan Amount |
$229,320 |

The annual interest rate |
0.0427 |

P0 | $229,320 |

r | 0.0427 |

k | 12 |

N | 30 |

Monthly Payment 'd' |
$1,130.80 |

Total payments |
$407,088.00 |

Total interest paid |
$177,768.00 |

Minimum monthly take-home pay |
$3,230.86 |

Minimum monthly gross pay |
$4,425.84 |

Minimum annual gross pay |
$53,110.08 |

Purchase price | 254800 |

Down Payment | 0.1 |

Down Payment |
=B1*B2 |

Loan Amount |
=B1-B3 |

The annual interest rate |
=4.27%/1 |

P0 | =B4 |

r | =B6 |

k | 12 |

N | 30 |

Monthly Payment 'd' |
=PMT(0.0427/12,12*30,-229320) |

Total payments |
=1130.8*12*30 |

Total interest paid |
=B12-B7 |

Minimum monthly take-home pay |
=1130.8/35% |

Minimum monthly gross pay |
=3230.86/73% |

Minimum annual gross pay |
=4425.84*12 |

You have found your dream home in Memphis, Tennessee! The home
is priced at $379,200, and the bank requires a 3% down payment. You
plan to finance the home for thirty years, and you will make
monthly payments on the home loan. The bank offers you a 1.79%
interest rate. What is your monthly house payment?

You want to buy a $233,000 home. You plan to pay 5% as a down
payment, and take out a 30 year loan for the rest.
a) How much is the loan amount going to be?
$
b) What will your monthly payments be if the annual interest rate
is 6%?
$
c) What will your monthly payments be if the annual interest rate
is 7%?
$

You want to buy a $183,000 home. You plan to pay 15% as a down
payment, and take out a 30 year loan for the rest.
a) How much is the loan amount going to be?
$
b) What will your monthly payments be if the annual interest rate
is 6%?
$
c) What will your monthly payments be if the annual interest rate
is 7%?
$

purchase of your first home for
$600,000.
You have just purchased the house and have put a 20% down
payment, and will borrow the remaining amount. The
15-year fixed rate loan has an Annual Percentage Rate (APR) of
3.875%. You will make monthly payments for the
life of the loan.
Question 12
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Suppose you decide to purchase a $150,000 home using an
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is the principal on your loan. Suppose the interest rate on a 30
year mortgage is 4.75%.
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How much will you pay on the loan if you pay...

As you are applying for your mortgage loan, you and the bank
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$
b) What will your monthly payments be?
$
c) How much total interest do you pay?
$
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You are planning to purchase a house that costs
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You want to buy a $209,000 home. You plan to pay 5% as a down
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c) What will your monthly payments be if the interest rate is
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You want to buy a $258,000 home. You plan to pay 10% as a down
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c) What will your monthly payments be if the interest rate is
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