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I’m trying to study for my Programming course and I need some help to understand this question.
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Get started on the assignment by watching the Should I Buy a House? video on the link below then answer the following questions.
http://media.pearsoncmg.com/ph/esm/chet_cleaves_cbsm9e_12/tools/RealWorldCase_before.htm
Joe has decided that he is tired of paying rent and not building equity of his own. He thinks that he is ready to assume the responsibility of owning a home and has found what he believes is the perfect first home. Joe meets with the loan officer at his bank where the process of buying a home is started. The loan officer provides Joe with a great deal of information, leaving him excited and apprehensive at the same time.
What you know:
The purchase price of the house is $75,000.
Joe has $10,000 in savings.
Joe makes $15 per hour and works 40 hours per week.
30-year mortgage interest rate of 6.25% and a monthly payment of $439.00
15-year mortgage interest rate of 5.25% and a monthly payment of $575.00
Down payment: 5% minimum
Taxes last year were $375.
Insurance is $250 per year.
What you are looking for:
Solution Plan:
Complete the following questions based upon the information in the video and other information provided in the worksheet.
Description of Fee | Amount of Fee | Extended Amount |
Down Payment | 5% of purchase price | |
Loan Origination Fee | No fee at this bank | |
Points | No points on this loan | |
Appraisal Fee | $400 | |
Credit Report | $50 | |
Insurance—First Year Premium | $250 | |
Mortgage insurance | $45 (one month) | |
Escrow Account Insurance reserve | Insurance for two months ($250 / 12) * 2 | |
Escrow Account Tax reserve | Property Taxes for two months($375 / 12) * 2 | |
Attorney fees | Buyer’s choice. None here. | |
Title Insurance | $700 | |
Processing/Underwriting | $100 | |
Document Preparation and Recording Fees | $250 | |
Survey | $125 | |
Tax Service | $50 | |
Flood Certification | $20 | |
Title Co. Fee | $150 | |
Pre-paid Interest | Depends on closing date: Estimate $150.00 | |
Total Due at Closing: |
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