Total cost of a mortgage. Legends often require home buyers to pay “points.” A point is 1 % of the purchase price of the home. In addition, the buyer also pays closing costs at the time of purchase. If you are taking out a 30-year mortgage for $ 140 , 000 , calculate the total costs for option A and option B below, that is, Total cost = points + closing costs + total mortgage payments . Which option, A or B, has the greater total cost? Assume that points and closing costs are paid separately and are not included in the mortgage. Use Table 8.6 for monthly payments. A: Annual interest rate 5 % ; 2 points; closing costs $ 4 , 500 . B: Annual interest rate 6 % ; 1 points; closing costs $ 2 , 500 .
Total cost of a mortgage. Legends often require home buyers to pay “points.” A point is 1 % of the purchase price of the home. In addition, the buyer also pays closing costs at the time of purchase. If you are taking out a 30-year mortgage for $ 140 , 000 , calculate the total costs for option A and option B below, that is, Total cost = points + closing costs + total mortgage payments . Which option, A or B, has the greater total cost? Assume that points and closing costs are paid separately and are not included in the mortgage. Use Table 8.6 for monthly payments. A: Annual interest rate 5 % ; 2 points; closing costs $ 4 , 500 . B: Annual interest rate 6 % ; 1 points; closing costs $ 2 , 500 .
Solution Summary: The author compares the cost of the two options: option A with mathrm277,948 and option B.
Total cost of a mortgage. Legends often require home buyers to pay “points.” A point is
1
%
of the purchase price of the home. In addition, the buyer also pays closing costs at the time of purchase. If you are taking out a 30-year mortgage for
$
140
,
000
, calculate the total costs for option A and option B below, that is,
Total cost
=
points
+
closing costs
+
total mortgage payments
.
Which option, A or B, has the greater total cost? Assume that points and closing costs are paid separately and are not included in the mortgage.
Cabin Financial Service Group recommends that a client purchase for $10,000 a corporate bond that earns 8% annual simple interest. How much additional money must be placed in an investment that earns a simple interest rate of 7% so that the total annual interest earned from the two investments is 7.5% of the total investment?$
A store has a sale with 12% off every item. When you enter the store you receive a coupon that states you receive an additional 8% off the sale price. If you purchase an item that sells for $350, what will your total discount be in dollar amount and In percent?
State whether the following statement is true or false, and explain why. If the statement is false, state the true change.
You receive a pay raise of 8%, followed later by a pay cut of 8%. After the two changes in pay, your salary is unchanged.
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