Question

You would like to buy a house that costs $ 350,000. You have $50,000 in cash that you can put down on the house, but you need to borrow the rest of the purchase price. The bank is offering you a 30-year mortgage that requires annual payments and has an interest rate of 9% per year. You can afford to pay only $28,320 per year. The bank agrees to allow you to pay this amount each year, yet still borrow $300,000. At the end of the mortgage (in 30 years), you must make a balloon payment; that is, you must repay the remaining balance on the mortgage.

**How much will be this balloon payment?** Hint:
The balloon payment will be in addition to the 30th payment.

Answer #1

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You would like to buy a house that costs
$350,000.
You have
$50,000
in cash that you can put down on the house, but you need to
borrow the rest of the purchase price. The bank is offering you a
30-year mortgage that requires annual payments and has an interest
rate of
7%
per year. You can afford to pay only
$22,970
per year. The bank agrees to allow you to pay this amount each
year, yet still borrow
$300,000....

You are thinking of purchasing a house. The house costs
$350,000. You have $50,000 in cash that you can use as a down
payment on the house, but you need to borrow the rest of the
purchase price. The bank is offering a 30-year mortgage that
requires annual payments and has an interest rate of 7% per year.
What will your remaining balance after 9 years

You are planning to buy a house today. The house costs $400000.
You have $57000 in cash that you can use as a down payment on the
house, but you need to borrow the rest of the purchase price. The
bank is offering a 30 -year mortgage that requires annual payments
and has an EAR of 8% per year. What will be your annual mortgage
payment?

You are thinking of purchasing a house. The house costs $
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purchase price. The bank is offering a 30-year mortgage that
requires annual payments and has an interest rate of 10 % per year.
What will be your annual payment if you sign this mortgage?

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1.)
You
want to buy a house in Hermosa Beach CA, but you can only afford to
make monthly payments of $7,100. The interest rate on mortgages
right now is 4.25% p.a. with monthly compounding (APR), fixed for
30 years, with monthly payments. You have $155,000 saved to use as
a downpayment. What is the most that you can afford to pay for a
house (ignoring closing costs, property taxes, etc..)?
Answer: $1,598,265.76
2.)
Under
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Use the following to answer questions 2-3. You have decided to
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mortgage with an interest rate of 7% per year.
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