Use your calculator to determine (1) the current mortgage payment (2) the total
ID: 2794703 • Letter: U
Question
Use your calculator to determine (1) the current mortgage payment (2) the total interest paid, (3) the payment after the first adjustment and (4) the maximum payment for each of the following $163,700 - 30-year mortgages. Assume that the initial interest rate is 7.40 percent.
a. Annually adjustable, 1 percent per year, 5 percent lifetime cap. Assume also that rates increase at least 1 percent per year until they reach the lifetime cap and rates never again drop below the lifetime cap for the term of the mortgage.
b. Fixed for 3 years and then annually adjustable, 2 percent per year, 5 percent lifetime cap. Assume also that rates increase at least 2 percent per year until they reach the lifetime cap and rates never again drop below the lifetime cap for the term of the mortgage.
c. Fixed for 5 years then annually adjustable, 2 percent per year, 6 percent lifetime cap. Assume also that rates increase at least 2 percent per year until they reach the lifetime cap and rates never again drop below the lifetime cap for the term of the mortgage.
d. Fixed for 5 years and then adjustable every 5 years, 3 percent per period, 6 percent lifetime cap. Assume also that rates increase at least 3 percent per year until they reach the lifetime cap and rates never again drop below the lifetime cap for the term of the mortgage.
Questions:
a. The current mortgage payment is? $ (Round to the nearest cent.)
The payment after the first adjustment is? $ (Round to the nearest cent.)
The maximum payment is? $ (Round to the nearest cent.)
The total interest paid for a $163,700 30-year mortgage is? $ (Round to the nearest cent.)
b.The current mortgage payment is ? $ (Round to the nearest cent.)
The payment after the first adjustment is? $ (Round to the nearest cent.)
The maximum payment is? $ (Round to the nearest cent.)
The total interest paid for a $163,700 30-year mortgage is? $ (Round to the nearest cent.)
c. The current mortgage payment is? $ (Round to the nearest cent.)
The payment after the first adjustment is? $ (Round to the nearest cent.)
The maximum payment is? $(Round to the nearest cent.)
The total interest paid for a $163,700 30-year mortgage is? $ (Round to the nearest cent.)
d. The current mortgage payment is? $ (Round to the nearest cent.)
The payment after the first adjustment is? $ (Round to the nearest cent.)
The maximum payment is? $ (Round to the nearest cent.)
The total interest paid for a $163,700 30-year mortgage is? $ (Round to the nearest cent.)
Explanation / Answer
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Current Motrgage Payment Principal 1,63,700 Rate of Interest 7.40% 0.617% Per Month Years 30 360 months Monthly Mortgage Payment= =(163700*.617%*(1+.617%)^360)/((1+.617%)^360-1) 1,134 Payment after first adjustment Current Motrgage Payment Principal 1,62,162 Rate of Interest 8.40% 0.700% Per Month Years 29 348 months Monthly Mortgage Payment= =(162162*.7%*(1+.7%)^348)/((1+.7%)^348-1) 1,245 Working Note: 13 th interest and principal payment total Instalment 360.00 Less: Already paid (13-1) 12.00 Remaining Instalment (t) 348.00 Monthly Payment (PMT) 1,133.87 Monthly Rate of Interest ( r ) 0.6167% PV=PMT*(1-(1+r)/t)/r =1133.87*(1-(1+.00617)^-348)/.00617 1,62,162.04 Loan Balance after payment of 24th instalment 1,62,162.04 C Payment after fifth adjustment Maximum Payment) Current Motrgage Payment Principal 1,56,801 Rate of Interest 12.40% 1.033% Per Month Years 25 300 months Monthly Mortgage Payment= =(156801*1.033%*(1+1.033%)^300)/((1+1.033%)^300-1) 1,698 d) total interest paid for 25 years =1698*300=509400-156801=352,599 For five years 75,169 Total Intereat payment=427768 Installment Int. Prin. Balance Int. rate 0 163700 1 $ 1,133 $ 1,010 $ 124 $ 1,63,576 0.6167% 2 $ 1,133 $ 1,009 $ 125 $ 1,63,451 0.6167% 3 $ 1,133 $ 1,008 $ 125 $ 1,63,326 0.6167% 4 $ 1,133 $ 1,007 $ 126 $ 1,63,200 0.6167% 5 $ 1,133 $ 1,006 $ 127 $ 1,63,073 0.6167% 6 $ 1,133 $ 1,006 $ 128 $ 1,62,945 0.6167% 7 $ 1,133 $ 1,005 $ 129 $ 1,62,816 0.6167% 8 $ 1,133 $ 1,004 $ 129 $ 1,62,687 0.6167% 9 $ 1,133 $ 1,003 $ 130 $ 1,62,557 0.6167% 10 $ 1,133 $ 1,002 $ 131 $ 1,62,426 0.6167% 11 $ 1,133 $ 1,002 $ 132 $ 1,62,294 0.6167% 12 $ 1,133 $ 1,001 $ 133 $ 1,62,161 0.6167% 13 $ 1,247 $ 1,135 $ 112 $ 1,62,049 0.7000% 14 $ 1,247 $ 1,134 $ 113 $ 1,61,937 0.7000% 15 $ 1,247 $ 1,134 $ 114 $ 1,61,823 0.7000% 16 $ 1,247 $ 1,133 $ 114 $ 1,61,709 0.7000% 17 $ 1,247 $ 1,132 $ 115 $ 1,61,593 0.7000% 18 $ 1,247 $ 1,131 $ 116 $ 1,61,477 0.7000% 19 $ 1,247 $ 1,130 $ 117 $ 1,61,361 0.7000% 20 $ 1,247 $ 1,130 $ 118 $ 1,61,243 0.7000% 21 $ 1,247 $ 1,129 $ 118 $ 1,61,125 0.7000% 22 $ 1,247 $ 1,128 $ 119 $ 1,61,005 0.7000% 23 $ 1,247 $ 1,127 $ 120 $ 1,60,885 0.7000% 24 $ 1,247 $ 1,126 $ 121 $ 1,60,764 0.7000% 25 $ 1,365 $ 1,259 $ 105 $ 1,60,659 0.7833% 26 $ 1,365 $ 1,258 $ 106 $ 1,60,553 0.7833% 27 $ 1,365 $ 1,258 $ 107 $ 1,60,446 0.7833% 28 $ 1,365 $ 1,257 $ 108 $ 1,60,338 0.7833% 29 $ 1,365 $ 1,256 $ 109 $ 1,60,230 0.7833% 30 $ 1,365 $ 1,255 $ 109 $ 1,60,120 0.7833% 31 $ 1,365 $ 1,254 $ 110 $ 1,60,010 0.7833% 32 $ 1,365 $ 1,253 $ 111 $ 1,59,899 0.7833% 33 $ 1,365 $ 1,252 $ 112 $ 1,59,787 0.7833% 34 $ 1,365 $ 1,252 $ 113 $ 1,59,674 0.7833% 35 $ 1,365 $ 1,251 $ 114 $ 1,59,560 0.7833% 36 $ 1,365 $ 1,250 $ 115 $ 1,59,446 0.7833% 37 $ 1,485 $ 1,382 $ 103 $ 1,59,342 0.8667% 38 $ 1,485 $ 1,381 $ 104 $ 1,59,238 0.8667% 39 $ 1,485 $ 1,380 $ 105 $ 1,59,133 0.8667% 40 $ 1,485 $ 1,379 $ 106 $ 1,59,027 0.8667% 41 $ 1,485 $ 1,378 $ 107 $ 1,58,920 0.8667% 42 $ 1,485 $ 1,377 $ 108 $ 1,58,812 0.8667% 43 $ 1,485 $ 1,376 $ 109 $ 1,58,703 0.8667% 44 $ 1,485 $ 1,375 $ 110 $ 1,58,593 0.8667% 45 $ 1,485 $ 1,375 $ 111 $ 1,58,483 0.8667% 46 $ 1,485 $ 1,374 $ 112 $ 1,58,371 0.8667% 47 $ 1,485 $ 1,373 $ 113 $ 1,58,258 0.8667% 48 $ 1,485 $ 1,372 $ 114 $ 1,58,145 0.8667% 49 $ 1,609 $ 1,502 $ 106 $ 1,58,039 0.9500% 50 $ 1,609 $ 1,501 $ 107 $ 1,57,931 0.9500% 51 $ 1,609 $ 1,500 $ 108 $ 1,57,823 0.9500% 52 $ 1,609 $ 1,499 $ 109 $ 1,57,714 0.9500% 53 $ 1,609 $ 1,498 $ 110 $ 1,57,603 0.9500% 54 $ 1,609 $ 1,497 $ 111 $ 1,57,492 0.9500% 55 $ 1,609 $ 1,496 $ 112 $ 1,57,379 0.9500% 56 $ 1,609 $ 1,495 $ 114 $ 1,57,266 0.9500% 57 $ 1,609 $ 1,494 $ 115 $ 1,57,151 0.9500% 58 $ 1,609 $ 1,493 $ 116 $ 1,57,036 0.9500% 59 $ 1,609 $ 1,492 $ 117 $ 1,56,919 0.9500% 60 $ 1,609 $ 1,491 $ 118 $ 1,56,801 0.9500% $ 75,169Related Questions
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