For the Following Second Mortgage Application, Calculate the Percentage of Appraised

question 50

Short Answer

For the following second mortgage application, calculate the percentage of appraised value and the potential credit: $$\begin{array} { l l l l l } \text { Appraised } & \text { Lender's } & \text { Percentage of } & \text { Balance of First } & \text { Potential } \\\text { Value } & \text { Percentage } & \underline { \text { Appraised Value } } & \underline { \text { Mortgage } } & \underline { \text { Credit } }\\\$120,600&60\%&&\$40,300&\end{array}$$

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Definitions:

Annual Interest Rate

The annual interest rate is the percentage of principal charged by the lender for the use of its money over one year.

Down Payment

An initial upfront partial payment for the purchase of expensive items/services such as a home or a car.

Annual Payments

Payments made once a year, often related to loans, leases, or insurance policies.

Lease

A contractual agreement where one party, the lessor, grants another party, the lessee, the right to use an asset for a specified period in exchange for payments.