Homework answers / question archive / 1004 Project Questions Questions and Calculations What is the 30 year fixed “purchase money” market Interest rate at your bank? What is the “APR” for #1? (you do not have to calculate this, it should be available from your bank

1004 Project Questions Questions and Calculations What is the 30 year fixed “purchase money” market Interest rate at your bank? What is the “APR” for #1? (you do not have to calculate this, it should be available from your bank

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1004 Project Questions

Questions and Calculations

1. What is the 30 year fixed “purchase money” market Interest rate at your bank?
2. What is the “APR” for #1? (you do not have to calculate this, it should be available from your bank.)
3. Have the Buyaars been on their jobs long enough?

If the maximum Front- end and Back-End Debt-to-Income ratios are 33%/38%:

4. Do Buyaars make enough income to qualify for the loan?
5. Do they have too much other debt?
6. What are the actual Front-End and Back-End debt-to-income ratios for the Buyaars?

 

7. Do they have enough cash reserve for down payment and closing costs?
8. Will the Buyaars be required to pay Private Mortgage Insurance? If no, why not?
9. What is the conforming loan amount for this property and have the Buyaars exceeded it?
   1. See loan limits at:  https://www.fanniemae.com/content/tool/loan-limit-table.xls
   2. Go to the bottom of the Excel Worksheet and click on “2019 Loan Limit by County” tab, then scroll down until you find Los Angeles County.
10. How much interest will be paid over the life of the loan?  (use:  usmortgagecalculator.org)
11.  What year is the balance of the loan at approx. $200,000?  (use:  usmortgagecalculator.org)
12. Do the Buyaars have too many children for this loan?
13. Approximately how old are the Buyers and have they exceeded the age limit for this loan?

 

 

Extra Point Question (10 points)

14. What is the maximum price home the Buyers could purchase without exceeding either of the debt-to-income ratios? *

 

*Assumptions:

1. Maximum debt-to-income ratios -   33%/38%
2. Property Taxes are 1.1% of Purchase Price
3. Hazard Insurance price won’t change
4. Must have 20% down payment