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Michael Yau_Unit 8

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  • 1. Which Mortgage is Better? By: Michael Yau
  • 2. Background In this unit we learn about mortgage. In fact which kind of mortgage Is better or a better word to quote it would be which fits the best for “u”. Mortgage doesn’t only differ in amount of money they offer but also the amount of time it is attach to the loan. In conclusion this project is all about comparing and deciding which loan best fits for you or the occasion you’re in.
  • 3. What Mortgage was offers?  Cost of the house: $175,000  Down Payment: 10%  Period: 15years, 30years  Amount of Loan: $157,500  Interest Rate: 5%
  • 4. Venn Diagram
  • 5. Comparison of each mortgage 15 30Interest Paid over life $66,695.10 $146,883.32Total amount paid $224,195.10 $303,883.32Monthly Payment $1,245.50 $845.49Extra $100 $7,733.43 $35,048.35Extra $500 $26,237.55 $87,921.09
  • 6. Interest Paid Over Life Interest Paid$160,000.00$140,000.00$120,000.00$100,000.00 $80,000.00 Interest Paid $60,000.00 $40,000.00 $20,000.00 $0.00 15 Years 30 Years
  • 7. Total Amount Paid Total Amount Paid$350,000.00$300,000.00$250,000.00$200,000.00 Total Amount Paid$150,000.00$100,000.00 $50,000.00 $0.00 15 Years 30 Years
  • 8. Monthly Payment Monthly Payment$1,400.00$1,200.00$1,000.00 $800.00 Monthly Payment $600.00 $400.00 $200.00 $0.00 15 Years 30 Years
  • 9. Extra $100 Interest Paid If Extra $100 Is paid$40,000.00$35,000.00$30,000.00$25,000.00 Interest Paid If Extra$20,000.00 $100 Is paid$15,000.00$10,000.00 $5,000.00 $0.00 15 Years 30 Years
  • 10. Interest paid if $500 is add$90,000.00$80,000.00$70,000.00$60,000.00$50,000.00 Interest paid if $500 is$40,000.00 add$30,000.00$20,000.00$10,000.00 $0.00 15 Years 30 Years
  • 11. Job III (senior) chemist Annual Salary: $70,363 Monthly Salary: $5863.58 http://depositphotos.com/3873987/stock-photo- Chemist-at-work.html
  • 12. Calculation Monthly Payment:  15 years- $1,245.50  30 years- $845.49 Monthly Salary- $5,863.58 Calculation:  15 years- $1,245,50 $5,863.58 = 21%  30 years- $845.49 $5,863.58 = 14% http://www.iconarchive.com/show/must-have- icons-by-visualpharm/Check-icon.html
  • 13. Calculation 15 years  Total Fixed Payment: $1245.5+ $1329.67 $5863.58 = 44% 30 years http://www.iconfinder.com/icondetails/27842/ 128/close_delete_exit_no_reject_icon  Total Fixed Payment: $845.49+$1329.67 $5863.58 = 37% http://www.iconarchive.com/show/must-have- icons-by-visualpharm/Check-icon.html
  • 14. Which one is better? It’s better to take out a 30 years mortgage because it only cost you 14% of your total income which means you would have the rest to spend and save on other things. Also the total amount loan you can ask for is 36% of your total monthly income. Therefore, it gives you an extra 22% are for loans. Also 30 years mortgage qualify the requirement for fixed payment. Plus it gives you a lot more to spend and save.
  • 15. Sources http://www1.salary.com/Chemist-III-Salary.html http://www.lendingtree.com/mortgage- loans/advice/qualifying-for-a-loan/minimum- mortgage-qualifications/ http://www.fha.com/fha_requirements_debt.cfm