Final RES3200 Dervish Nivokazi Fixed-Rate Mortgages • What are the basic characteristics of mortgages that we will study? o Payments and pricing § Elements relating to the cost of borrowing o Structure § Innovations the payment patterns and allocation of risk and return among borrower and lender • In a fixed-rate mortgage‚ the contract rate stated in the mortgage note is fixed for the term of the loan o Even if rates are fixed‚ payments may vary depending on the type of loan § Regular
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interpret the terms of mortgage loan financing purchase of properties compute the monthly mortgage loan payment and mortgage insurance premium compute the rental return on property investment 2 Selection Criteria of Mortgage Loan The following factors should be considered when choosing mortgage loan plan: 1. Interest Rate 2. Borrowing Period 3. Installment Loan Repayments 4. Cash Rebate 3 Interest Rate In Hong Kong’s mortgage loan market‚ there are three different
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Student answers will vary. Encourage students to consider both their financial situation and personal factors. 2. Based on the following data‚ would you recommend buying or renting? Rental Costs Buying Costs Annual rent‚ $7‚380 Annual mortgage payments‚ $9‚800 ($9‚575 is interest) Insurance‚ $145 Property taxes‚ $1‚780 Security deposit‚
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Engineering Economic Analysis Case Study Case Name The Smithson’s Mortgage Case Study Teams This case is designed to be conducted by a team of students. The discussion‚ questioning‚ and resolution of differences is an important part of the learning experience. Another significant advantage is the sharing of the workload in preparing the final case study report. Knowledge Background This case draws heavily on the material presented in Chapters 2 and 3 of Principles of Engineering Economic Analysis
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find payment amounts‚ you may use Excel‚ the EZ Calculators app‚ or the tables in the Chapter if those tables have the needed values. When finding an APR‚ give an exact value using Excel or the EZ Calculators app. Show work. 1] A cell phone has a purchase price of $299. The phone can be financed by putting $100 down and paying $20.50 a month for 12 months. Find (a) the amount financed‚ (b) the total monthly payments‚ and (c) the total finance charge. Total selling price = $299 Down payment = $100
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low-income families‚ and special needs children has a 30-year‚ 5% mortgage on the existing building. The mortgage requires monthly payments of $3‚000. Raffie’s bookkeeper is preparing financial statements for the board and in doing so‚ lists the mortgage balance of $287‚000 under current liabilities because the board hopes to pay off the mortgage in full next year. $20‚000 of the mortgage principal will be paid next year according to the mortgage agreement. * The board members call you‚ their trusted
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Government Do? The mortgage crisis we are experiencing in the United States today is already ranking as among the most serious economic events since the Great Depression of the 1930’s. Hardly a day goes by without a story in the newspaper or on the cable news stations reporting about the increase in the number of foreclosures across the United States. The effects of this crisis have spread across all financial markets‚ where in the end all of us are paying a price for this home mortgage crisis. When the
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another 11. Banks have recently launched a service through which money can be transferred using mobile phones. This service is known as (a) MMTF (Mobile Money Transfer Facility) (b) MTMT (Mobile To Mobile Transfer) (c) IMPS (Inter Bank Mobile Payment Service) (d) IBMPS (Internet
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record the following. • The issuance of the bonds. • The payment of interest on July 1‚ assuming that interest was not accrued on June 30. • The accrual of interest on December 31. QUESTION 3 On January 1‚ Flory Company issued $300‚000‚ 8%‚ 5-year bonds at face value. Interest is payable semiannually on July 1 and January 1. Prepare journal entries to record the following events. • The issuance of the bonds. • The payment of interest on July 1‚ assuming that interest was not accrued
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the APR with monthly compounding? Using the formula for converting from an EAR to an APR quote With annual payments k = 1‚ so APR = 5% With semiannual payments k = 2‚ so APR = 4.939% With monthly payments k = 12‚ so APR = 4.889% Problem 16 You have just purchased a car and taken out a $50‚000 loan. The loan has a five-year term with monthly payments and an APR of 6%. a. How much will you pay in interest‚ and how much will you pay in principal‚ during the first month
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