What will you owe the bank

Reference no: EM13258337

You are 62 years old, and your house appraises for $450,000. A bank is willing to give you a reverse mortgage at 50% LTV with a 6% fixed contract rate. You choose an option to receive equal monthly payments over a period of 10 years.

a) What will these payments be?
b) If you choose to move after 5 years, what will you owe the bank?
c) If the home appreciates at 1%, how old will you be before your loan balance exceeds the value of the home?

Reference no: EM13258337

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