# Financial Algebra HELP!?

15 year 6/1 ARM at 5% with a 2/6 cap structure

What are the maximum interest rates for the 7th year and for the life of the mortgage?

a. 7th year: 6%; Lifetime: 6%

b. 7th year: 6%; Lifetime: 11%

c. 7th year: 7%; Lifetime: 11%

Meghan has a 15-year adjustable rate mortgage with a rate of 5.4% for the first 5 years. The monthly payment is \$2,394.77. The amount of the mortgage is \$295,000. What is the remaining balance after 5 years rounded to the nearest dollar?

a.\$253,392

b.\$151,314

c.\$221,673

d.\$196,667

A \$900,000 balloon mortgage has terms of 25/7 with a 4% interest rate. What is the monthly payment rounded to the nearest dollar?

a.\$4,751

b.\$3,120

c.\$3,000

d.\$4,297

Edith obtains a \$2,250,000 balloon mortgage for an investment property. The mortgage has terms of 20/4 at an interest rate of 4.5%. The monthly payment is \$14,234.61. How much is the remaining balance after 4 years rounded to the nearest dollar?

a.\$2,036,457

b.\$1,566,739

c.\$1,945,745

d.\$1,800,000

The bank offers Mario a fixed rate loan with no points and a fixed rate loan with points. The difference in monthly payments between the loan with points and the loan without points is \$37.18. The cost of the points is \$2,600. What number is closest to the break-even point rounded to the nearest month?

a.6 months

b.26 months

c.70 months

d.82 months

Drew is purchasing a home for \$452,000. He makes a 20% down payment and obtains a 30-year fixed rate mortgage loan at 6% annual interest. His monthly payments are \$2,167.98. He pays an intangible tax of 0.2%. Which of the following is the total cost of principal, interest, down payment, and intangible tax?

a.\$780,472.80

b.\$781,196.00

c.\$871,596.00

d.\$871,776.80

Relevance
• 7 years ago

Jalysa J

A \$900,000 balloon mortgage has terms of 25/7 with a 4% interest rate. What is the monthly payment rounded to the nearest dollar?

a.\$4,751 / mo

The payments are the same as a 25 year fixed mortgage with 4% APR. The only difference is after 7 years the remaining balance (the "balloon") is due immediately.

Hope that helps