Repay the remaining balance on the mortgage

Assignment Help Financial Management

Reference no: EM131973447

You are thinking of purchasing a house. The house costs $350,000. You have $50,000 in cash that you can use as a down payment on the house, but you need to borrow the rest of the purchase price. The bank is offering a 30-year mortgage that requires annual payments and has an interest rate of 7% per year. You can afford to pay only $23,500 per year. The bank agrees to allow you to pay this amount each year, yet still borrow $300,000. At the end of the mortgage (in 30 years), you must make a balloon payment; that is, you must repay the remaining balance on the mortgage. How much will this balloon payment be?

Reference no: EM131973447

Questions Cloud

Mission statement-favorite dine-in restaurant : Please post your organization mission statement or your favorite dine-in restaurant (ex. Hash House, Hard Eight BBQ, Grand Lux, Roy's Pacific Cuisine

Consistent between various industries : What would this value be and would it be consistent between various industries? and what you refrences you based your answer on?

Make algorithm which is based on temperature sensor : You need to prepare methodology, Take a idea from uploaded file and make algorithm which is based on temperature sensor.

Problem of interest of buying a used car : This project concerns a problem of interest of buying a used car. Run variable selection procedure to choose most important x's

Repay the remaining balance on the mortgage : You must repay the remaining balance on the mortgage. How much will this balloon payment be?

Challenging for smaller businesses : Do you think SME's should consider holding larger cash reserves to ensure they are in a better position to make riskier investment

The firm uses macrs depreciation with five-year tax life : What is NPV if the firm uses MACRS depreciation with a 5-year tax life? What is project NPV?

External factors that have an influence on business : Give examples of the ways in which each factor can affect the business performance of two companies: Wal-Mart and Ford.

Write examples of regulation of social media : Examples of regulation of social media and discussion of such regulation (Is it good, bad, or indifferent? How could circumstances change the situation?)

User Account

All Pages