M/W W 10:00 am coin $2 ‘Math 1050 Mortgage Project Matin Det NameCALI2i ROSenvail Duedate: 12/5/18 Inthis project we will examine @ home loan or mortgage. Assume that you have found a home for sale and have agreed toa purchase pre of $201,000, Down Payment: You are going o make a 10% down payment on the house. Determine the amount of your down payment and th balance to finance. Down Payment §§20, 100 Mortgage Amount $]| 80, 400 4201000 XB.|=$20100 120(, 000-20, 100 190/460 Part: 30 year Mortgage alelate the monthly payment for a 30 year loan (rounding up to the nearest cent) by using the following formula. Show your work. [PMT isthe monthly loan payment, Ps the mortgage amount, ri the annual pereet rate forthe lean in decimal, and Ys ‘the number of years to pay off the loan} For the 30 year loan use an annual interest rate of 4.975%, PMT = ~a+ Show work how 100400 (as 30 mage WE P4975 98 0.0475, Eee > woH00 i 749-98128 1 T-0oqusea3y 7 v MA ASE 2 $968.95 THA 95307 s ‘Monthly Payment for a30 year mortgage 108.25" ‘Note that this monthly payment covers only the interest and the principal on the loan, It does not ‘cover any insurance or taxes on te propery. “Amortization Schedule: In order to summarize all the information regarding the amontization of| 8 Toan, construct a schedule that keeps tack of the payment number, the principal paid, the Interest, and the unpaid balance. A spreadsheet program isan excellent tool to develop anamortization schedule, We can use fee amortization spreadshect on the web ‘The web address is:irHtP0:// WW. cimortizathoa - Cale-Com Enter the amount ‘of he loan, ie. the selling price minus the down payment, the Interest rat, andthe appropiate ‘number of years. Check the box to show the schedule. use sede Amorizaton Sted monthly payment ora 30 year mongase $468.25 _ wuw-bankrtate.com (Note: if this is more than 2 or 3 cents different fom your calculation, check your numbers!) (100 (a fOFS/ rere pal ove 167,705.37 Mortgagecy Toa ners pid ver 30 year 3 eon Total amount paid 24 £, (905 Calcolator- aspx Nahar amount oe payment gosta the pcp andthe mou ht oes ihe aru sung ¢ 10 paeh elucfuafe based ae af Wether yo Amount going FoWaldd borh Fluctvate bi SY nok in on tf the ayrnent is Paid ofe Wangs the a0 seats, or eeror or rep bee nbs a thetnges Avopbes: iu Ga @ ver Bing Bodie eae He eben rapes. "ume i mn nm pen svar an Re Aerie ct es ae rica and nett. You Sate Aaa Nero ‘monly payments for home nance and propery taxes In addon, it ishepi to ave mone le ove for tos ite lars ik elacc runing wae, and food. Asa wise home ‘woe, you decile tht your moatly propa and intrest payment shoul not exceed 35% of yur monthly take-home pay. What minimum monthly take-home pay should you have in order to mect this goal? Show your work for making this ealeuation. Siow wae [A828 os 2960.71 0487 wv 457 0 a rnonthly tke home pay oF &em6-11 1S 9qU5-5. Minimum monthly ake home pay = $2-/16000T1« we I's elso important to note that your net or take-home pay (after taxes is less than your gross pay (before taxes). Assuming that your net pay s 73% of your gross pay, what minimum gross annual salary will you need to make to have the monthly net salary slated above? Show your ‘Wor for making this calculation. ienhiy ot pa before fayos: 00° =e ZH OF HIMT= FHTO] v ATplot|+247.0] npalt YE55[5 CORON Cssbe i> BSR 12. months Minimum gros annual salary = BUD, UO OC Part Il: Selling the House Lt’ suppose that after living inthe house for 10 years, you want o sell. The economy experiences ups and downs, but in general the value of real estate increases ver time. To calculate the value of an investment such a eal estate, We use continuously compounded Find the value of the home 10 years afer purchase assuming continuous interest rate of 4%. Use the fll purchase price asthe principal. Show your work. “Stow wore P= $201,000 re Body lez to years Ae Da Aime WV calcuiettor eee wow! an increase oF G48, eso! ‘Valve of ome 10 years after purchase 32.14, $56.70