Real estate - Excel assignment
Usf1
SoultionHW2-LastNameFirstName.xlsxAnswer Sheet
| Fin 331 | ||||||
| Homework 2 | ||||||
| Name: | Type Your Name Here | |||||
| Loan | A | B | C | D | ||
| Description | 80% LTV Lower Rate | 80% LTV | 90% LTV Fixed 30 | 80% LTV 5-Year ARM | ||
| Higher Rate | ||||||
| Offer Price | $475,000 | $475,000 | $475,000 | $475,000 | ||
| Rate | 3.250% | 3.625% | 3.500% | 2.875% | ||
| Qual Rate | 3.250% | 3.625% | 3.500% | 3.500% | ||
| Annual MI Rate | 0% | 0% | 0% | 0.00% | ||
| Points | 1.60 | 0.00 | 0.25 | 1.00 | ||
| Other Prepaid Finance Charges | $ 1,500.00 | $ - 0 | $ 1,500.00 | $ 1,500.00 | ||
| LTV | 80% | 80% | 90% | 80% | ||
| Calculate Monthy Income | Other Debt Payments | |||||
| Total other monthy Payments | Student Loans | |||||
| Down Payment | Car Payment | |||||
| Loan Amount | Credit Cards | |||||
| Monthly Principal & Interest | Total Other Payments | |||||
| Monthly Mortgage Insurance Payment | ||||||
| Property Taxes/month | ||||||
| Insurance/Month | ||||||
| Total House Payment | ||||||
| Loan Payment used to qualify to ARM | ||||||
| House Payment used to qualify for ARM | ||||||
| Housing Ratio | ||||||
| Total Debt to Income Ratio | ||||||
| Total Prepaid Finance Charges | ||||||
| APR for the Loan | ||||||
| Do they qualify for this loan? | ||||||
| Down Payment | ||||||
| Closing Costs | ||||||
| Prepaid Finance Charges | ||||||
| Total Cash to Close on the House | ||||||
| Analysis of Your Calculations | ||||||
| Calculate the difference in the cash required to close and the total monthly payment for the 30 year loan with the higher rate and the 90% loan with mortgage insurance. | ||||||
| Additional Cash to Close [Loan B Less Loan C] | Additional Monthly Pmt [Loan B Less Loan C] | |||||
| Should these buyers take the 90% loan and use the reduced cash to close to pay off their student loans? Explain you recommendation. | ||||||
| ERROR:#NUM! | ||||||
| Rate on Difference of payment compared to down payment for loans B and C. | ||||||
| Calculate the rate of return on the difference of Cash to Close here: | ||||||
| Use this space to explain why they should or should NOT put down 10% | ||||||
| Consider the ARM loan. | ||||||
| What is the balance after 5 years? | ||||||
| What is the maximum possible principal and interest payment on that loan in year 6, when the rate adjusts? | ||||||
| Which Loan option would you recommend? Loan | ||||||
| Why do you suggest this option? | ||||||
Check YES
Check NO
