Mortgage Project
Your best friend wants your help reviewing mortgage loan options and has asked you to help since you have recently studied the mathematics of consumer loans. Your friend is currently living in another state and needs your help finding a home to purchase as well as selecting a mortgage.
1. Choose a home for sale in Volusia or Flagler County to use for your calculations. Check out local realtors' websites for the property.
2. Your friend is not certain about how large the down payment will be so make calculations considering a down payment of both 10% and 20% of the sale price.
3. Using the Internet, find local interest rates. Assume that your friend has a good credit history.
4. Find a mortgage payment calculator on the Internet to calculate monthly payments for 15-year and 30-year fixed rate mortgages using both 10% and 20% down payments.
5. Calculate the total interest paid for each loan option.
6. Examine the amortization schedule for each loan option to determine the first month where the payment towards the principal is greater than the interest payment.
7. Use a mortgage payment calculator on the Internet to determine how much interest you would save by paying an extra $100 toward the principal each month.
8. Complete the Mortgage Project Summary form and submit to the Assignments folder. Based on your friend's financial situation, which of the four loan options would you recommend for your friend? Write a letter to your friend explaining the option you are recommending and why it is your friend's best option.
Attachment:- Assignment Files.rar