Real Estate Finance and Calculations

ANSWER THE FOLLOWING QUESTIONS.

1. The essential activities that take place in the primary mortgage market are;

A. Underwriting and origination

B. Leasing and sales

C. Pooling and securitization

D. Search and rescue

2. The essential activities that take place in secondary mortgage markets are;

A. Underwriting and organization

B. Leasing and sales

C. Pooling and securitization

D. Search and rescue

3. An assumable mortgage is defined by the absence of a or an;

A. Exculpatory clause

B. Acceleration clause

C. Due on sale clause

D. Subordination clause

4. If you are free to sell, lease, or use your property as collateral without any limitation on the amount of time you have to do these things, you are purchasing?

A. A land contract

B. Estate for years

C. A lease fee estate

D. A fee simple estate

5. In a standard mortgage contract, the principal borrower is said to be amortized over the term of the loan. In other words, when a borrower makes their scheduled payment for the principal balance;

A. Decreases

B. Remain the same

C. Increases

D. Decreases then, after a while, increases

6. Eddie wants to borrow $ 325 000 to purchase a new condo in NY.

a) What are her monthly payments for a fully amortized 30- years fixed mortgage with a 4.5% contract rate?

b) How much of her first payment goes toward repaying the amount borrowed?

c) How much of her thirteenth payment goes toward repaying the amount borrowed? What are her monthly payments for a partially amortizing 30-year fixed rate mortgage with a 4.5% contract rate when requires a balloon payment of $250 000.

Question 6a to c calculations

7. You borrow $ 350000 with a 30-year fixed rate mortgage with a contract rate of 6% .For each month in the first two years of the loan, you are offered a choice between making the scheduled full amortization payment or a minimum payment of $ 1500.After the initial two-year period, the existing balance of the loan is amortized over the remaining 28 years. If you make the minimum payment each month for the first two years of the loan, what the new mortgage balance after making these payments.

8. Suppose that you decide to make the minimum payment each month for the first two years of the loan, what will your fixed payment be for remaining term of the loan.

Answers to question 7 and 8 below: