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Loan Project: Buying a House




Question;Instructions: For this assignment, you will analyze a home;mortgage loan.;1. Find a description, asking price, and real estate taxes of a house for sale;and decide on a purchase price you would be willing to pay (assuming you have;the means). Find a current market interest rate for a 30-year fixed-rate;mortgage having a down payment of 20 percent of the purchase price.;2. Compute the down payment, amount financed, and the monthly mortgage payment;(showing how to use the appropriate financial formula).;3. Compute the monthly amount of real estate taxes and add to the monthly;mortgage payment to get the total monthly amount paid.;4. Suppose that in order to qualify for the loan, the total monthly amount paid;cannot exceed 30 percent of monthly income. What is the minimum monthly income;needed to qualify for the loan? What is the minimum annual income needed?;(Note: This is a simplified minimum income requirement calculation, for the;purposes of this project, as it does not take into account other costs such as;insurance or other loans or assets currently held.);5. Construct an amortization table (using spreadsheet software or online resources;such as;6. Assume that the first payment is made in January of the current year. Find;the month and year of the last payment. Find the date of the first month when;the amount applied to the principal exceeds the amount of interest paid. How;many of the 360 payments have been made at this point?;7. Assuming that the mortgage is held for the full 30 years, compute the total;principal paid and the total interest paid.;8.Effectively communicate your analysis, interpretation, evaluation, and the;results you found to be particularly interesting, and why.;Your report must include;? name of project and your name;? house's description, asking price, and real estate taxes, the purchase price;and the current market interest rate (include references);? computations and answers for tasks 2, 3, and 4, amortization table for task;5, answers for task 6, and computations and answers for task 7;? conclusion (task 8)


Paper#61187 | Written in 18-Jul-2015

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