Question

Please forgive me, but I am appealing to you to please solve these 6 problems for me in the most simpler of steps that I can use to practice. Thanks so much. Garnett

1. Purchaser applies for an FHA loan to buy home for $102,000. FHA guarantees 97% of first $25,000 of purchase price and 95% of the balance. Lender charges three points (3%) to be paid at closing. How much cash will be advanced to purchaser?

2. Joe borrows 80% of purchase price of home at 9% interest.What is price of home if first monthly payment of interest is $265?

3. Andy sells home through broker for 7% commission. Andy nets $6,500 after paying existing mortgage of $23,400 and tax lien of $512.00. What did Andy's house sell for?

4. Property at end of 3 years is valued at $82,500. It depreciated 2.5% during each of 3 years. What was original value?

5. Store is leased with agreement at a monthly rent of $300 plus 4.5% of the gross income over 200,000. Lessee pays total rent of $4,725 for 2008. What was gross amount of Lessee's business for 2008?

6. Mary sells property for $150,000 and realizes a 20% return on investment. How much did she originally pay for property?

Again, thanks so much for your help.

Answer 1

1. Cash Adv. = 0.97*25000 + 0.95*(102000-25000) = 24,250 + 73,150 +
0.03*102000 = $100,460.

2. Purchase price = $P.
lOAN Amount = $0.8P.
I = 0.8P*.09*(1/12) = $265.
0.006P = 265,
P = $44,166.67 = Purchase price.

3. Selling price = $X.
Commmission = $0.07X.

X - 0.07X - 23,400 -512 = $6500,
0.93X - 23,912 = 6500,
0.93X = 30,412,
X = 32,701.08.

4. Po - 0.025*3Po = $82,500,
0.925Po = 82,500,
Po = $89,189.19. = Initial value.

5. C=$300 + 0.045(G - $200,000)=$4725.
300 + 0.045G - 9000 = 4725,
G = $298,333.33 = Gross income.

6. Po + 0.2Po = $150,000,
1.2Po = 150,000,
Po = $125,000. = Original price.

Answer 2

Thanks greatly, Henry. May God bless your soul.

G