This week you will complete your first course activity, a journal worksheet regarding purchasing a new home. Below are the specifics of the loan you will acquire for yo
This week you will complete your first course activity, a journal worksheet regarding purchasing a new home. Below are the specifics of the loan you will acquire for your property:
Down Payment Required (List %):
15%
Number of Points at Closing
2 points
Mortgage Time Frame for Loan:
30 years
Interest Rate (List %):
7%
Annual Homeowner’s Insurance Amount:
$1500
Annual Property Taxes Amount:
$3000
Name: __________________________________________ Date_________________
Week 3 Activity: Mortgage Journal
I. Provide a Screenshot of Sales Page of the Property. Make sure to include the following in this section:
· Picture of Property
· Sales Price of Property
· Description of Property
· Link to the Property Sales Page
II. Your instructor will give you information about the mortgage for the property. Add the information given by your instructor below:
|
Down Payment Required (List %): |
|
|
Number of Points at Closing |
|
|
Mortgage Time Frame for Loan: |
|
|
Interest Rate (List %): |
|
|
Annual Insurance Amount: |
|
|
Annual Escrow Taxes Amount: |
III. Calculations—Make sure to round all values on this journal to the nearest cent (Two Decimal Places). Make sure to SHOW WORK on parts b) – f).
a) Sale Price of Property: ___________________________
b) Find the required down payment.
c) Find the amount of the mortgage.
d) How much must be paid for points at closing?
e) Find the monthly payment (excluding escrow taxes and insurance).
f) Find the total interest paid over the timeframe of the loan.
IV. Prepare a loan amortization schedule for the first three months of the mortgage. Show work for calculations below the table. Round values to two decimal places.
This is the amount you will use on the Loan Amortization Table Below:
|
Payment Number |
Monthly Payment |
Interest Payment |
Principal Payment |
Balance of Loan |
|
1 |
||||
|
2 |
||||
|
3 |
Work for Payment #1:
Work for Payment #2:
Work for Payment #3:
Calculate your ACTUAL Monthly Payment:
a) How much is the annual insurance amount? _______________________
Divide the amount by 12 to determine the monthly insurance payment: _______
b) How much is the annual escrow taxes? _____________________
Divide the amount by 12 to determine the monthly escrow tax payment: ______
c) Add the monthly insurance payment and monthly escrow tax payment to your monthly mortgage payment:
Actual Monthly Payment: ________________________
V. Conclusion Questions
1. Describe what happens to the portion of payments going to principal and interest over the life of a mortgage.
__________________________________________________________________________________________
__________________________________________________________________________________________
2. Describe what would happen to the monthly payment and total interest if the mortgage time frame was cut in half.
__________________________________________________________________________________________
__________________________________________________________________________________________
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