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8. A 5/1 adjustable rate mortgage has a fixed rate period for five years and then the rate can adjust once every year.
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- A price level adjusted mortgage ( PLAM) is made with the following terms: Amount = $ 96, 800 Initial interest rate = 4 percent Term = 30 years Points = 6 percent Payments to be reset at the beginning of each year. Assuming inflation is expected to increase at the rate of 6 percent per year for the next five years: Required: a. Compute the payments at the beginning of each year (BOY). b. What is the loan balance at the end of the fifth year? c. What is the yield to the lender on such a mortgage?A price level adjusted mortgage (PLAM) is made with the following terms: Amount = $95,800Initial interest rate = 4 percentTerm = 30 yearsPoints = 6 percent Payments to be reset at the beginning of each year. Assuming inflation is expected to increase at the rate of 6 percent per year for the next five years: Required: a. Compute the payments at the beginning of each year (BOY).b. What is the loan balance at the end of the fifth year?c. What is the yield to the lender on such a mortgage?A mortgage has the following terms: Amount: $750,000 Rate: 6.25% Amortization (Years): 30 Term (Years): 20 Please determine the following: What is the Monthly Payment? In preparing an Income Statement, what is the Interest Expense for years 1 – 5? What is the Principal Balance at the end of year 6? What is the value of the loan at the expiration? If rates remain constant (flat), what would the benefit be to refinance this loan after year 10? do all the questions 1-5 and show the formulas in excel and show how you got it
- Consider a 15-year fixed - rate mortgage for $325000 with a 3.19% APR. 1. Prepare a loan amoritization schedule for the mortgage. 2. What is the balance of the loan after 7 years of payments? 3. How many installments (payments) must be made before more than half of the payment amount is applied to the principal?A price level adjusted mortgage (PLAM) is made with the following terms: Amount = $95,700 Initial interest rate = 4 percent Term = 30 years Points = 6 percent Payments to be reset at the beginning of each year. Assuming inflation is expected to increase at the rate of 6 percent per year for the next five years: Required: a. Compute the payments at the beginning of each year (BOY). b. What is the loan balance at the end of the fifth year? c. What is the yield to the lender on such a mortgage? Please SHOW me how this is done. I cannot calculate payment when inputing these values to Excel. Thank you!A price level adjusted mortgage (PLAM) is made with the following terms:Amount $95,000Initial interest rate 4 percentTerm 30 yearsPoints 6 percentPayments to be reset at the beginning of each year.Assuming inflation is expected to increase at the rate of 6 percent per year for the next five years:a. Compute the payments at the beginning of each year (BOY).b. What is the loan balance at the end of the fifth year?c. What is the yield to the lender on such a mortgage?
- A price level adjusted mortgage (PLAM) is made with the following terms: Amount = $96,000 Initial interest rate = 4 percent Term = 30 years Points 6 percent Payments to be reset at the beginning of each year. Assuming inflation is expected to increase at the rate of 6 percent per year for the next five years: Required: a. Compute the payments at the beginning of each year (BOY). b. What is the loan balance at the end of the fifth year? c. What is the yield to the lender on such a mortgage? Complete this question by entering your answers in the tabs below. Required A Required B Required C Compute the payments at the beginning of each year (BOY). Note: Do not round intermediate calculations. Round your final answers to 2 decimal places. Payments Year 1 $ 90,240.00 Year 2 $ 84,825.60 Year 3 $ 79,736.06 Year 4 $ 74,951.90 Year 5 $ 70,454.79If an adjustable-rate 30-year mortgage for $116,500 starts at 7.0 percent and increases to 8.0 percent, what is the increase in the monthly payment amount? Use Exhibit 7-7. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Monthly payment increaseThe most common adjustment interval on an adjustable rate mortgage (ARM) once the interest rate begins to change has been Multiple Choice O six months. one year. three years. ten years. None of these choices are correct.
- A price level adjusted mortgage (PLAM) is made with the following terms: Amount = $96,000Initial interest rate = 4 percentTerm = 30 yearsPoints = 6 percent Payments to be reset at the beginning of each year. Assuming inflation is expected to increase at the rate of 6 percent per year for the next five years: b. What is the loan balance at the end of the fifth year?c. What is the yield to the lender on such a mortgage? I am having trouble with b. and c.A 21-year mortgage is amortized by making payments of $3052.61 at the end of every three months. If interest is 8.45% compounded annually, and you want to know what was the original mortgage balance? Find p (the equivalent rate of Interest per payment period) Select one: a. 0.015075125 b. 0.0055556 O c. 0.024329 d. 0.0204868 e. 0.0078846In a 5/1 hybrid adjustable-rate mortgage (ARM), the initial interest rate is fixed for 5 years, then is adjusted annually. (You usually pay points upfront at closing in exchange for the rate lock for the first 5 years.) Suppose that you buy a house with a $ 150000, 30-year mortgage with a 5/1 ARM with an initial rate of 5.5%; and suppose that five years later, the interest rate goes up to 7.5%. Use the Bankrate amortization schedule online to determine what your monthly payment was, originally, at 5.5%?Monthly Payment = What is your new payment? (Careful: the amount of the loan is no longer $ 150000, and you only have 25 years to pay it off.)New Monthly Payment =