Lesson 3 Feb 18 2010

http://www.mls.ca/splash.aspx

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.

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

Harley purchases a home with a market value of
$209 000. His downpayment is $45 000.
Determine Harley's equity.

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

Meagan 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 Meagan's monthly payment.

With Meagan's first payment how much of it will be interest?

What is Meagan's equity amount for her home?

Assignment #3 Page 27

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Lesson 3 Feb 18 2010

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Lesson 3 Feb 18 2010