Case Study 1: Evaluating Loan Options for Flo

CS1. Purchase Price 500000

Number of Compounding Periods/year 4
Optional Balloon Payment 20000

Option 1 2 3
Down Payment 20% 10% 5%
Nominal Interest Rate pa 4.90% 5.25% 5.75%
Duration (yrs) 30 30 30
Points 3 3 3
Fees 375 375 375
Loan Value 400,000 450,000 475,000
Monthly Payment ($2,126.70) ($2,489.38) ($2,776.93)
Actual Amount Borrowed 387,625 436,125 460,375
APR 5.19% 5.55% 6.06%
Payment with Balloon ($2,102.03) ($2,466.24) ($2,755.84)
Quarterly Payment ($6,380.11) ($7,468.13) ($8,330.79)
Payment with Balloon (Qtr) ($6,306.10) ($7,398.71) ($8,267.52)

Considering Option 1 as it is the most viable option available

Private loan (1) annual rate: 5.0%

Private loan (2) duration: 20.38
CD value enough for down payment: $1
: Evaluating Loan Options for Flowers By Diana

Actual borrowed amount

600,000
500,000
400,000
4 5 6 7 300,000
0% 20% 10% 5% 200,000
6.25% 5.50% 6.00% 6.50% 100,000
-
30 30 15 15 1 2 3 4 5 6 7
3 1 0 0
0 0 350 350 APR
500,000 400,000 450,000 475,000 7.00%
6.00%
($3,084.02) ($2,275.23) ($3,809.01) ($4,150.94) 5.00%
485,000 396,000 449,650 474,650 4.00%
3.00%
6.56% 5.61% 6.06% 6.56% 2.00%
($3,064.83) ($2,253.14) ($3,739.72) ($4,084.49) 1.00%
0.00%
($9,252.07) ($6,825.69) ($11,427.04) ($12,452.81) 1 2 3 4 5 6 7
($9,194.49) ($6,759.41) ($11,219.17) ($12,253.48)

s the most viable option available.