Married couple has carefully looked at budget

Assignment Help Financial Management

Reference no: EM131982565

A young married couple has carefully looked at their budget. After review, they can afford a monthly mortgage payment of $1,053.00. They go to their local banker and she offers them a mortgage of 5.28% APR with monthly compounding with a term of 30 years. The couple has enough savings to pay 20% down, so the mortgage will be 80% of the home’s value.

1. What is the mortgage that the couple can apply for based on their budget and the offered terms?

2. With this mortgage and a 20% down payment, what priced house can the couple afford?

Reference no: EM131982565

Questions Cloud

Increased or decreased through accounting methodologies : On average, shareholders of. A company's net earnings can be increased or decreased through accounting methodologies. Why?

Behavioral finance supports : Behavioral finance supports the

What are the risk-neutral probabilities : What are the risk-neutral probabilities? What is the gross return (Rf) of the riskfree bond?

Slowly adjust their beliefs to new information is referred : The principle that investors slowly adjust their beliefs to new information is referred to as

Married couple has carefully looked at budget : A young married couple has carefully looked at their budget. After review, they can afford a monthly mortgage payment of $1,053.00.

How large will the annual payment be : How large will the annual payment be? The annual scholarship payment will be ?

Industry ratios are presented in standard sources : When industry ratios are presented in standard sources, which one of following pairs show reference or bench mark against which to measure company’s performance

What is the size of the loan taken out by the couple : A couple has just purchased a home for $373,900.00. What is the size of the loan taken out by the couple? What is the monthly payment on the loan?

Mutually exclusive projects are of different sizes : You know that two mutually exclusive projects are of different sizes. The smaller project is known to have a positive NPV.

User Account

All Pages