3 mortgages feb 22

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3 mortgages feb 22

  1. 1. http://www.mls.ca/splash.aspx 1
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  4. 4. Mortgages def'n ­ A loan secured by property.  Principal The amount of money you borrow; initially the difference  between the selling price of the property and the down payment Interest The amount you will pay for borrowing money Mortgage payment A regular installment, usually made up of principal and  interest Amortization Period The actual number of years it will take to repay the  entire mortgage.  Term The length of time that a specific mortgage agreement  covers, generally between 6 months and 10 years.  4
  5. 5. Equity: the value of the property, over and  above all claims, generally the difference  between the market value and the outstanding  principal of all mortgages relating to the  property.  http://www.investorwords.com/5605/home_equity.html 5
  6. 6. Gabriel purchases a home with a market value of  $209 000. His downpayment is $45 000.  Determine Gabriel's equity.  6
  7. 7. If you take out a mortgage for $125 000,  from the credit union for 25 years at a rate  of 6.75%, find the monthly payment.  http://www.edu.gov.mb.ca/k12/assess/archives/cm_wt_rp_08.pdf 7
  8. 8. Samara purchases a home with a market value of  $297 000. She makes an initial down payment of  $35 000. She arranges a 20 year mortgage at 4.75%.  Calculate Samara's monthly payment.  8
  9. 9. With Samara's first payment how much of it will be interest?  What is Samara's equity amount for her home?  9
  10. 10. Assignment #3 Page 27 Work, work, work 10

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