A fully amortizing CAM loan is made for $125,000 at 11 percent interest for 20 years. a. What will be the monthly payments and remaining loan balances for the first six months? b. What would monthly payments be if the loan were CPM instead? c. If both loans (the CAM and CPM) are repaid at the end of year 5, would the lender earn a higher rate of interest on either loan? Which one and why? Use Excel. A $100,000 CPM fully amortizing loan is made, at a 3% interest rate compounded monthly, for a 15 year term. Loan comes with a charge of 3 points. What is the effective annual rate on the loan?

A fully amortizing CAM loan is made for $125,000 at 11 percent interest for 20 years. a. What will be the monthly payments and remaining loan balances for the first six months? b. What would monthly payments be if the loan were CPM instead? c. If both loans (the CAM and CPM) are repaid at the end of year 5, would the lender earn a higher rate of interest on either loan? Which one and why? Use Excel. A $100,000 CPM fully amortizing loan is made, at a 3% interest rate compounded monthly, for a 15 year term. Loan comes with a charge of 3 points. What is the effective annual rate on the loan?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter22: Providing And Obtaining Credit

Section: Chapter Questions

Problem 2P: Cost of Bank Loan Mary Jones recently obtained an equipment loan from a local bank. The loan is for...

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Cost of Bank Loan Mary Jones recently obtained an equipment loan from a local bank. The loan is for 15,000 with a nominal interest rate of 11%. However, this is an installment loan, so the bank also charges add-on interest. Mary must make monthly payments on the loan, and the loan is to be repaid in 1 year. What is the effective annual rate on the loan (assuming a 365-day year)?
A fully amortizing CAM loan is made for $132,000 at 6 percent interest for 20 years. Required: a. What will be the payments and balances for the first six months? b. What would payments be for a CPM loan? c. If both loans were repaid at the end of year 5, would the lender earn a higher rate of interest on either loan? Complete this question by entering your answers in the tabs below. Required A Required B Required C What will be the payments and balances for the first six months? (Round your intermediate calculations and final answers to the 2 decimal places.) Month 1 Month 2 Month 3 Total Payment End Balance
You have taken out a $7,500,000 loan with a 4% interest rate, 30 year amortization and ten year term. What is the loan balance after the final loan payment? a. $0 b. $7,390,303 c. Cannot determine with information provided d. $5,908,797
If someone borrow $4000 with interest rate 4% and has to return the loan with equal payment in 4 years. The amount of the annual payment is: Select one: а. $1169.85 b. $1400 c. $1313.9 d. $1240
Suppose you borrow $14,000. The interest rate is 11%, and it requires 4 equal end-of-year payments. Set up an amortization schedule that shows the annual payments, interest payments, principal repayments, and beginning and ending loan balances. Round your answers to the nearest cent. If your answer is zero, enter "0". Beginning Repayment Ending Year Balance Payment Interest of Principal Balance 1 $ fill in the blank 60 $ fill in the blank 61 $ fill in the blank 62 $ fill in the blank 63 $ fill in the blank 64 2 $ fill in the blank 65 $ fill in the blank 66 $ fill in the blank 67 $ fill in the blank 68 $ fill in the blank 69 3 $ fill in the blank 70 $ fill in the blank 71 $ fill in the blank 72 $ fill in the blank 73 $ fill in the blank 74 4 $ fill in the blank 75 $ fill in the blank 76 $ fill in the blank 77 $ fill in the blank 78 $ fill in the blank 79
Suppose that you borrow$ 12000 at interest rate of 5% per year. If you must be repaid the loan in equal end of year payments over the next 4 years, how much must you repay at the end of each year? O a. $3672 Ob. $3384 Oc. $2672 O d. $2384
I need help with d. Basic ARM is made for $250,000 at an initial interest rate of 6 percent for 30 years with annual reset date. The borrower believes that the interest rate at the beginning of the year 2 will increase to 7 percent. a. Assuming that a fully amortizing loan is made, what will monthly payments be during year 1? PMT = $1498.88 b. Base on (a), what will the loan balance be at the end of year 1? FV = $246,929.97 c. Given that the interest rate is expected to be 7 percent at the beginning of year 2, what will monthly payments be during year 2? PMT = $1659.69 d. What will be the loan balance at the end of year 2?
The following loan is a simple interest amortized loan with monthly payments. $7000, 7%, 4 years (a) Find the monthly payment. (Give your answer to the nearest cent.) Payment $189.58 (b) Find the total interest for the given simple interest amortized loan. (Give your answer to the nearest cent.) Total interest $ 2100 X
A loan is to be repaid by $1500 in one year and $2250 in four years. The borrower has asked to repay $1000 in 1.5 years and a final payment in three years. If money can earn 6% compounded quarterly, what is the size of the final payment? Select one: O a. 2735.18 O b. 2705.50 O C. 2725.50 O d. 2755.85 O e. 2715.50
Q5. Suppose you borrow $10,000. You are going to repay the loan by making equal annual payments for five years. The interest rate on the loan is 15 percent per year. Prepare an amortization schedule for the loan. How much interest will you pay over the life of the loan? Beginning Total Principal Ending Year Interest balance payment раyment раyment balance 1 $10,000 2 3 2,983.16 4 5 0.00