Exam_3_additional_math_questions_post_review_session -...

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ANSWERS AND EXPLANATIONS TO ALL QUESTIONS ARE AT THE END OF THIS DOCUMENT. 1) If I expect the NOI in my first year to be $550,000, given the assumptions below, what is the maximum loan amount a lender would give me? 1.20 DSCR Market Cap rate of 7.8% 75% LTV 10 year term 25 year amortization Interest rate of 7.0% (monthly compounding) 2) A lender will give you a loan in an amount that produces a Housing Expense Ratio of 28%. What is the maximum the lender would be willing to give you based on the assumptions below: Annual household income of $82,000 Monthly insurance is $52.00 Annual real estate taxes (property taxes) are $3,800 Interest rate of 5.5% Amortization of 30 years 3) Eight years ago, you took out a loan with a 15 year term to purchase a residential apartment building in downtown Madison. Assuming a 7.5% interest rate with amortization over 30 years and a monthly payment of $3,496.07, calculate the balloon payment if you were to hold the loan until maturity. 4) Consider the following: Purchase Price: $800,000 NOI: $78,000 DSCR: 1.35 Land value as a percentage of overall value: 20% Income Tax Rate:
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This note was uploaded on 04/09/2012 for the course REAL EST 306 taught by Professor Mccabe during the Spring '12 term at Wisconsin.

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Exam_3_additional_math_questions_post_review_session -...

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