Question 12 of 17Gavin and Holly purchased a $590,000 condominium in Toronto. They paid 20% of theamount as a down payment and secured a 25-year mortage for the balance. Theynegotiated a fixed interest rate of 2.9% compounded semi-annually for a 5-year termwith repayments made at the end of every month. Their mortgage contract also statedthat they may prepay up to 15% of the original principal every year without at interestpenalty. At the end of the first year, in addition to the regular monthly payment, theymade a lump-sum payment of $28,000.a. What was the size of the monthly payment?Round to the nearest centb. What was the principal balance at the end of the first year, prior to make the lumpsum payment?

Solving for Monthly Payment and Principal Balancea. Monthly Payment:We can use the Loan Payment…

Answered: Question 12 of 17 Gavin and Holly…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Part 4 (Chapter 14): Hassan and Dana had bought a property valued at $1,225,000 for 20% down and a mortgage amortized over 25 years on March 1, 2018. They made equal end-of-month payments towards their mortgage. Interest on the mortgage was 3.29% compounded semi-annually and the mortgage was renewable after five years. 9. What was the size of each monthly payment? 10. What is the cost of the mortgage for the first 5 years? 11. In November 2020, they decided to refinance their mortgage since rates were down by quite a lot. Suppose the new rate they qualified for was 1.74% compounded semi-annually and they could borrow enough to cover their remaining mortgage balance. The new mortgage is amortized over 25 years, but they also need to pay a penalty for breaking the old mortgage early. If the penalty is the interest differential over the remaining term of the old mortgage (under the old and the new rates), and if the penalty is also added to the new mortgage, what is the size of their new…
b.ZULU Mortgagors offers houses for sale on mortgage terms of 50% down payment of the property value and balance amortized over a four year period. Assuming you purchased a house valued at K450, 000,000 and paid the 50% down initial amount agreeing to pay the balance in four equal annual installments that include principle and 8.2% interest. Calculate the annual installment and draw the amortization schedule for this loan.
6. Assume an elderly couple owns a $140,000 home that is free and clear of mortgage debt. A reverse annuity mortgage (RAM) lender has agreed to a $100,000 RAM. The loan term is 12 years, the contract is 9.25%, and payments will be made at the end of each month. a. What is the monthly payment on this RAM? b. Fill in the following partial loan amortization table: Month 1 2 3 4 5 Beginning Balance Monthly Payment Interest Ending Balance C. What will be the loan balance at the end of the 12-year term? d. What portion of the loan balance at the end of year 12 represents principal? What portion represents interest?
OLA#9.3: A $270,000 house in Hamilton was purchased with a down payment of 20.00% of its value and a 25 year mortgage was taken for the balance. The negotiated fixed interest rate was 3.75% compounded semi-annually for a five-year term, with repayments made at the end of every month. a. Calculate the size of the monthly payments. b. Complete the partial mortgage schedule for the five-year term, rounding the answers to the nearest cent. (see attach image for a clearer view) Payment Number Payment Interest Portion Principal Portion Principal Balance 0 $216,000.00 1 2 : : : : : : : : : : : : : : : :
Question 6: Chetan is purchasing a home for $670,000. RBC has approved his loan application for a 25- year fixed rate loan at 5% annual interest. If Chetan pays 10% of the purchase price as down payment, calculate his monthly mortgage payment. If his annual property taxes are $1,560 and his annual homeowner's insurance is $720, calculate the total PITI payment for his loan.
Assume an elderly couple owns a $400,000 home that is free and clear of mortgage debt. A reverse annuity mortgage (RAM) lender has agreed to a $300,000 RAM. The loan term is 15 years, the contract is 5.25%, and payments will be made at the end of each month. What portion of the loan balance at the end of year 15 represents interest (rounded to thousands)? Excel a) $95,000 O b) $102,000 O c) $174,000 d) $198,000 e) $205,000
3. A $310,000 house in Hamilton was purchased with a down payment of 20.00% of its value and a 20 year mortgage was taken for the balance. The negotiated fixed interest rate was 3.75% compounded semi-annually for a five-year term, with repayments made at the end of every month. a. Calculate the size of the monthly payments. b. Complete the partial mortgage schedule for the five-year term, rounding the answers to the nearest cent.(see image attached) Kindly keep all the decimals for all the procedures, DO NOT ROUND
2.11.5: On January 1 of Year 1, Kylie Ramona borrowed $400,000 under a mortgage note payable contract. The annual interest rate on this mortgage is 12% compounded monthly. This is a 15-year, fully-amortizing monthly mortgage. The monthly payments are $4,800.67 and are due at the end of each month, starting on January 31 of Year 1. On January 31 of Year 1, Kylie Ramona decided to pay an extra $5,000.00 on the mortgage, so the total payment on that date was $9,800.67. Kylie Ramona made the regular $4,800.67 payment on February 28 of Year 1. What is the REMAINING BALANCE of the mortgage note payable as of February 28 of Year 1 after the monthly payment is made on that date? Note: The February 28 payment is the SECOND monthly payment. Also note that an extra $5,000.00 was paid on January 31.
onsider a $2,750,000 fully amortized loan with a term of 7 years and a fixed interest rate of 6.5%. Payments are made on an annual basis. a) Calculate the annual payments for the loan. b) Construct the amortization schedule for the seven years. Chris Columbus bought an equipment for his production business for $993,000. He put 15% down and obtained an interest-only loan for the balance at 8% annually for 5years. c) Find the amount of Chris’s annual interest payments. d) Find the total interest paid and total payments made by Chris over the five
Q6: Ethan secured a 4-year car lease at 6.20% compounded annually that required her to make payments of $888.30 at the beginning of each month. Calculate the cost of the car if she made a downpayment of $3,750.Round to the nearest cent
7 On January 1, 2003 Mike took out a 30-year mortgage loan in the amount of 200,000 at an annual nominal interest rate of 6% compounded monthly. The loan was to be repaid by level end-of-month payments with the first payment on January 31, 2003. b. What would be Mike's outstanding balance at the end of December 31st, 2007? Mike repaid an extra 10,000 in addition to the regular monthly payment on each December 31 in the years 2003 through 2007. c. Calculate Mike's updated outstanding balance at the end of December 31st, 2007. After this, Mike continues with his regular monthly payments of $1,199, except for the last payment (which is a drop payment) d. Calculate the drop payment.
1A: You have decided to buy a house and finance it with a 20-year, 4.25% APR mortgage. The house costs $625,000 and the bank requires a 20% down payment. All mortgage payments are made monthly at the beginning of the month. Show your work. Complete the amortization schedule below for the first three months of the mortgage.

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