A couple plans on refinancing their existing mortgage

Assignment Help Financial Management
Reference no: EM13872677

A couple plans on refinancing their existing mortgage. They currently owe $150,000 (which represents 70% of the value of the house) with 15 years left on the loan and monthly payments of $1300. A new loan will be financed at the 15 year fixed rate 1.3%. What will be the new monthly payments? How much equity will they have in the house 4 years from now if the price of the house doesn’t change over that time?

Reference no: EM13872677

Questions Cloud

The cost of land to be recorded by duane company : On January 1, Duane Company purchases land at a cost of $55,000.
Accounts receivable is part of the current assets : Accounts receivable represents credit sale, and thus, cannot be collected until maturity. Accounts receivable mainly consists of promissory notes and credit sales. Accounts receivable is part of the current assets.
The agency liability for unused vacation leave increased : The agency liability for unused vacation leave increased by $ 40,000 as a result of the year activities. The budget makes no provision for this expense until vacation leave is actually taken.
Calculate the yield to maturity that bond : A bond is worth 100$ Calculate the yield to maturity that bond. What yield to maturity would make the bond’s price equal $100?
A couple plans on refinancing their existing mortgage : A couple plans on refinancing their existing mortgage. They currently owe $150,000 (which represents 70% of the value of the house) with 15 years left on the loan and monthly payments of $1300. A new loan will be financed at the 15 year fixed rate 1...
Treasury notified the agency that the invoice : Treasury notified the agency that the invoice was paid To prepare its quarterly financial statements, the agency took an inventory and found that $ 35,000 of the materials were still on hand.
What is your unique selling proposition : First, tell us about your company or product. What is your unique selling proposition? How do you distinguish your product or company from your competitors
Determines the equivalent equal monthly payment series : Suppose you borrow $28000 at 12% compounded monthly over five years. Knowing that the 12% represents the market interest rate, you realize that the monthly payment in actual dollars will be $622.84. If the average general monthly interest rate is exp..
Arlette''s pet shop purchases a building : Arlette's Pet Shop purchases a building.

Reviews

Write a Review

Financial Management Questions & Answers

  Replace major piece of industrial equipment

A firm has decided to replace a major piece of industrial equipment. The equipment costs $690,000 to purchase and install and is expected to have a useful life of 5 years, after which it will be sold on the open market and is expected to have a salva..

  Applied should he be willing to sell out his future interest

Mark Cuban will receive $18 500 a year for the next 25 years as a result book he wrote. if a discount rate of 12% is applied should he be willing to sell out his future interest for 165,000?

  What is the financial leverage effect and what causes it

What is the financial leverage effect and what causes it?  What are the potential benefits and negative consequences of high financial leverage?

  Explain straight-line depreciation

The new copier will allow FA to increase revenues by $2,000 each year but expenses will also increase by $500 each year. Account receivables will increase by $500 and account payables will increase by $800 if the copier is purchased.

  What is the amount of the cash flow to creditors

A firm has earnings before interest and tax of $25380 with net income of $14220 the taxes amounted $5400 for the year. During the year the firm paid out $43800 to pay off existing debt and then later borrowed an additional $24000 what is the amount o..

  Bond is bought to yield convertible semi-annually

Find the price of a $1000 par value 10-year bond with coupons at 8.4% convertible semi-annually, which will be redeemed at $1050. The bond is bought to yield 10% convertible semi-annually for the first five years and 9% convertible semi-annually for ..

  Type of proforma method-incremental changes

With this type of proforma method, we look ahead on our balance sheet for large, incremental changes such as the expansion of a new factory. In this fashion, we are able to identify financing needs

  Dollar dividend payment per share each quarter

Specialty Chemicals Company (SCC) pays out 50% of its net income as cash dividends to its shareholders once each quarter. The company plans to do so again this year, during which SCC earned $100 million in net profits after tax. If the company has 40..

  What is the non-operating terminal cash flow of the machine

Lasalle Industries is considering the purchase of a new machine that will cost $250,000, plus an additional $10,000 to ship and install. The new machine will have a 5-year useful life and will be depreciated to zero using the straight-line method. Wh..

  Division is considering two investment projects

Your division is considering two investment projects, each of which requires an up-front expenditure of $24 million. You estimate that the cost of capital is 8% and that the investments will produce the following after-tax cash flows (in millions of ..

  What is the unlevered return on equity of the new project

Company A has a debt of $25,000,000 while its equity is $115,000,000. The beta of A's levered equity is 0.95 and the company keeps a constant debt-to- equity ratio. Company A's cost of debt is 4.35% and it bears no systematic risk. The expected retur..

  After tax-cost of debt

A bond that has a $1000 par value (face value)and a contract or coupon interest rate of 11.2 percent. Interest payments are $56.00 and are paid semiannually. The bonds have a current market value of $1128 and will mature in 10 years. The firm margina..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd