MORTGAGE ASSIGNMENT 1. Go to a. b. c. d. the internet and find four houses. The first one should cost less than $100,000 The second one should cost between $100,000 and $300,000 The third one should cost over $300,000 The last one can be your choice
2. PRINT at least one page for each of these houses showing the cost. 3. Complete the HOME MORTGAGES Worksheet. a. Use the 3 steps at the top of the page to do the example house ($200,500) b. Use the chart to find the mortgage loan factor (multiplier) on the bottom of this sheet c. To find the Monthly Payment for the $200,500 example house, use 200.5 (the comma becomes a decimal) times the mortgage loan factor from the chart (multiplier) d. To find the Total Paid, multiply the Monthly Payment by the number of months (years * 12) e. To find the Finance Charge, subtract the Total Paid by the Amount Financed 4. For House 1, notice the difference between a 15 year mortgage and a 30 year mortgage 5. For House 2, notice the difference when the interest rate changes 6. For House 3, notice the larger difference when the interest rate changes 7. For House 4, choose your own interest rates and time period
Loan Rate 6.0% 6.5% 7.0% 7.5% 8.0% 8.5% 9.0% 9.5% 10.0%
30 Years 6.94 6.29 6.64 6.99 7.34 7.69 8.05 8.41 8.78
25 Years 6.40 6.73 7.06 7.39 7.72 8.05 8.39 8.74 9.09
20 Years 7.16 7.46 7.76 8.06 8.36 8.68 9.00 9.32 9.65
15 Years 8.40 8.69 8.98 9.27 9.56 9.85 10.14 10.44 10.75
APR Example 8.5 8.5
Amount Financed
Years
Multiplier
Monthly Payment
Total Paid
Finance Charge
$200,500 $200,500
30 15
House 1 8.0 8.0 15 30
House 2 8.5 9.0 15 15
House 3 6.0 7.5 30 30
House 4
LOOKING AT BUYING A HOUSE Using your textbook Pages 593-599, answer the following questions: 1. Other than the monthly payment, identify and define other costs that are involved in buying a home?
2. When determining how much you can afford for housing, what % of gross income do lenders recommend?
3. What are POINTS when you relate to buying a home?