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A4 Basic Mortgage Problem (1)

# A4 Basic Mortgage Problem (1) - 4.750-1.625(\$1,625.00 i...

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A4 Basic Mortgage Problem Provident Funding Mortgage Rate Quotes as of 6/30/2011. [Note: pts/credit indicates the % of the principle borrowed as a fee that must be paid to borrow at the designated rate. 1 point = 1% of the amount borrowed. Negative points are payments made to the borrower at that rate.] Rate Pts/Credit % Pts/Credit \$ 4.250 % 1.250 % \$1,250.00 4.375 % 0.125 % \$0.00 4.500 % -0.500 % (\$500.00) 4.625 % -1.000 % (\$1,000.00)
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Unformatted text preview: 4.750 % -1.625 % (\$1,625.00) i) Using the above table, calculate the payment for a \$200,000 Mortgage for 30 years at 4.375%? Why is this rate the market rate? ii) Calculate the payment if the rate was 4.250%? iii) Determine the monthly saving at the lower rate. Calculate cost to obtain a 4.250% loan? iv) If you make the payment at the market rate for 5 years, what would be the remaining balance on your mortgage...
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