Question

Over the past 40 years, interest rates have varied widely. The
rate for a 30-year mortgage reached a high of 14.75% in July 1984,
and it reached 4.64% in October 2010. A significant impact of lower
interest rates on society is that they enable more people to afford
the purchase of a home. In the following exercise, we consider the
purchase of a home that sells for $125,000. Assume that we can make
a down payment of $25,000, so we need to borrow $100,000. We assume
that our annual income is $49,000 and that we have no other debt.
Assume that property taxes plus insurance total $250 per
month.

If we can afford to pay a monthly amount of $893.33, determine how
much we can borrow if the term is 30 years and the interest rate is
4.64%. (Round your answer to the nearest dollar.)

$ ???

Answer #1

Let, within x months, they will be repaid the whole amount.

Then, after x months, the whole amount will be = ${100000+[(100000*x*4.64)/(100*12)]}

And, after x months, the repaid amount will be = $[893.33*x] = $[2680*x/3]

By condition, 100000+[(100000*x*4.64)/(100*12)] = 2680*x/3

i.e., 100000*[1+{x*4.64)/(100*12)}] = 2680*x/3

i.e., 1000*[1200+(x*4.64)]/12 = 2680*x/3

i.e., 100*[1200+(x*4.64)] = 1072*x

i.e., 120000+(464*x) = 1072*x

i.e., (1072*x)-(464*x) = 120000

i.e., 608*x = 120000

i.e., x = 120000/608

Therefore, the repaid amount will be = ${100000*[1+{(120000/608)*4.64/1200}]} $176316.

B). Over the past 40 years, interest rates have varied widely.
The rate for a 30-year mortgage reached a high of 14.75% in July
1984, and it reached 4.64% in October 2010. A significant impact of
lower interest rates on society is that they enable more people to
afford the purchase of a home. In the following exercise, we
consider the purchase of a home that sells for $125,000. Assume
that we can make a down payment of $25,000, so...

Over the past 40 years, interest rates have varied widely. The
rate for a 30-year mortgage reached a high of 14.75% in July 1984,
and it reached 4.64% in October 2010. A significant impact of lower
interest rates on society is that they enable more people to afford
the purchase of a home. In the following exercise, we consider the
purchase of a home that sells for $125,000. Assume that we can make
a down payment of $25,000, so we...

Over the past 40 years, interest rates have varied widely. The
rate for a 30-year mortgage reached a high of 14.75% in July 1984,
and it reached 4.64% in October 2010. A significant impact of lower
interest rates on society is that they enable more people to afford
the purchase of a home. In the following exercise, we consider the
purchase of a home that sells for $125,000. Assume that we can make
a down payment of $25,000, so we...

You borrow 410,000 to buy a home using a 30-year mortgage with
an interest rate of 3.75 percent and monthly payment. After making
your monthly payments on time for exactly 6 years calculate your
loan balance. Disregard property taxes and mortgage insurance.

Following Our interest rates annual percentage rates for a 30
year fixed rate mortgage from a sample of lenders in a certain
city. It is reasonable to assume that the population is
approximately normal. 4.327, 4.461, 4.547, 4.695, 4.365, 4.669,
4.842 Find the upper bound of the 99% confidence interval for the
mean rate Round to three decimal places.

Following are interest rates (annual percentage rates) for a
30-year-fixed-rate mortgage from a sample of lenders in a certain
city. It is reasonable to assume that the population is
approximately normal. 4.327, 4.461, 4.547, 4.621 , 4.365, 4.558 ,
4.842 Find the upper bound of the 99% confidence interval for the
mean rate.

Following are interest rates (annual percentage rates) for a
30-year-fixed-rate mortgage from a sample of lenders in a certain
cityIt is reasonable to assume that the population is approximately
normal.
4.327,4.461,4,547 4.468, 4.365 , 4.707, 4.842
Find the upper bound of the 99% confidence interval for the
mean rate.
Round to three decimal places (for example : 4.015 ). Write
only a number as your answer . Do not write any units ..

Suppose you want to purchase a home for $425,000 with a 30-year
mortgage at 5.54% interest. Suppose also that you can put down 25%.
What are the monthly payments? (Round your answer to the nearest
cent.)
$
What is the total amount paid for principal and interest? (Round
your answer to the nearest cent) $
What is the amount saved if this home is financed for 15 years
instead of for 30 years? $

Consider a 30-year mortgage for $374680 at an annual interest
rate of 5.2%. After 12 years, the mortgage is refinanced to an
annual interest rate of 3.4%. How much interest is paid on this
mortgage? Round your answer to the nearest dollar.

Consider a 30-year mortgage for $327,723 at an annual interest
rate of 5.6%. After 12 years, the mortgage is refinanced to an
annual interest rate of 3.3%. How much interest is paid on this
mortgage? The answer is 282,628, but I'm not sure why?

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