709615

Texas Instruments BA Real Estate Manual

37
Zoom out
Zoom in
Previous page
1/96
Next page
36 Mortgages and Amortization
BEAR-CH1.DOC BA Real Estate Guidebook Jackie Quiram Revised: 09/28/99 1:16 PM Printed: 09/28/99 1:16 PM
Page 36 of 36
You are trying to help a buyer decide whether to use a
fixed-rate mortgage or an adjustable-rate mortgage. You
want to compare the fixed-rate term to the best one-year
adjustable loan you have found. Using the figures given
above and assuming a maximum adjustment at each
period, at what point would the savings from the
adjustable-rate mortgage become exhausted?
Before performing this comparison, complete the
Adjustable Rate Mortgage
worksheet to obtain the ARM
monthly payments for each adjustment period.
Adjustment Period Rate Payment
Initial 5.00% $778.39
Second 7.00% $960.21
Third 9.00% $1,153.34
Fourth (maximum) 11.00% $1,354.86
Steps Keystrokes Display
Clear TVM values.
#
-
0.00
Enter term.
30
0
TRM= 30.00
Enter fixed-rate interest.
7.5
1
I% = 7.50
Enter amount of loan.
145
q
2
LN = 145,000.00
Compute amount of
fixed-rate payment.
$
3
PMT=
-
1,013.86
Calculate monthly
savings/costs by
subtracting amount of
initial ARM payment
from fixed-rate payment.
t
X
778.39
j
235.47
Multiply monthly
savings/costs by number
of months in this ARM
period and store.
O
12
j
T
g
MEM= 2,825.65
Comparing an ARM to a Fixed-Rate Mortgage
For a loan of $145,000, you are comparing a fixed-rate
mortgage of 7.5% for 30 years to a 30-year ARM. The
ARM has an initial rate of 5% with a 2% maximum
adjustment for each 12-month period and a maximum
lifetime adjustment of 6%. Find the breakeven point.
Situation
Solution
… 37 …


Need help? Post your question in this forum.

Forumrules


Report abuse

Libble takes abuse of its services very seriously. We're committed to dealing with such abuse according to the laws in your country of residence. When you submit a report, we'll investigate it and take the appropriate action. We'll get back to you only if we require additional details or have more information to share.

Product:

For example, Anti-Semitic content, racist content, or material that could result in a violent physical act.

For example, a credit card number, a personal identification number, or an unlisted home address. Note that email addresses and full names are not considered private information.

Forumrules

To achieve meaningful questions, we apply the following rules:

Register

Register getting emails for Texas Instruments BA Real Estate at:


You will receive an email to register for one or both of the options.


Get your user manual by e-mail

Enter your email address to receive the manual of Texas Instruments BA Real Estate in the language / languages: English as an attachment in your email.

The manual is 0,5 mb in size.

 

You will receive the manual in your email within minutes. If you have not received an email, then probably have entered the wrong email address or your mailbox is too full. In addition, it may be that your ISP may have a maximum size for emails to receive.

The manual is sent by email. Check your email

If you have not received an email with the manual within fifteen minutes, it may be that you have a entered a wrong email address or that your ISP has set a maximum size to receive email that is smaller than the size of the manual.

The email address you have provided is not correct.

Please check the email address and correct it.

Your question is posted on this page

Would you like to receive an email when new answers and questions are posted? Please enter your email address.



Info