Loan Value
Contents
Example #1
A client is looking at purchasing a house. They feel they can afford monthly interest and principal payments of $1,100. They anticipate a 30 year loan with an interest rate of 7%. How much can they borrow?
Data Entry
Use the following values for the prompts:
Prompt |
Value |
|
Calculation Type |
Loan |
|
Calculate |
Loan Value |
|
Interest Rate |
7 |
|
Number of Years |
30 |
|
Type of Payment |
Level Payments |
|
Payments per Year |
12 |
|
Payment Amount |
1100 |
|
Payments Made At |
End of Period |
|
Balloon Payment |
0 |
Result
The client can borrow $168,990.33 over 30 years at 7%.
Example #2
If they went with a 15 year loan at 6.5%, how much would they be able to borrow?
Data Entry
Change the Interest Rate from 7% to 6.5%, and then change the Number of Years from 30 to 15.
Result
The client can borrow $127,770.74 over 15 years at 6.5%.