1 / 14

Term Project

Term Project . Part 3 Katelyn Merkley Scott Johnson Spencer Wolford. The Basics. Mortgages. Amortization Schedules. Amortization Schedule. 15 Year Mortgage Analyzed: Pros . Interest Rates are lower than a 30-year loan. Builds equity quicker due to shorter amortization schedule

chana
Download Presentation

Term Project

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Term Project Part 3 Katelyn Merkley Scott Johnson Spencer Wolford Math 1050 Term Project Group 4 Presentation

  2. The Basics Math 1050 Term Project Group 4 Presentation

  3. Mortgages Math 1050 Term Project Group 4 Presentation

  4. Amortization Schedules Math 1050 Term Project Group 4 Presentation

  5. Amortization Schedule Math 1050 Term Project Group 4 Presentation

  6. 15 Year Mortgage Analyzed:Pros • Interest Rates are lower than a 30-year loan. • Builds equity quicker due to shorter amortization schedule • Interest paid is dramatically lower over the duration of the loan • You pay more principal a month rather than more interest Math 1050 Term Project Group 4 Presentation

  7. 15 Year Mortgage Analyzed:Cons • Monthly payments are significantly higher than 30-year loans. • Restricts loan applicants to a smaller house than they might be able to afford with a 30-year loan. Math 1050 Term Project Group 4 Presentation

  8. 30 Year Mortgage Analyzed:Pros • Monthly payments are lower than 15-year loans because the interest is amortized over a long period • Lower monthly payments free up money for investments and savings • Higher interest, increases the amount home owners can deduct at tax time Math 1050 Term Project Group 4 Presentation

  9. 30 year Mortgage Analyzed:Cons • Borrowers build equity at a very slow rate because payments during the first several years goes largely toward the interest rather than the principal of the loan. • Over all interest paid is much higher due to the long amortization schedule. • The interest rates are higher than on 15-year loans. Math 1050 Term Project Group 4 Presentation

  10. Total Interest Comparison Math 1050 Term Project Group 4 Presentation

  11. Advantage of an extra $100 • Spencer found that if he were to add an extra $100 a month to his (15 year) monthly payment, in the long run, the total interest paid would be 16,258.72, rather than $19,919.29 • Total Savings: $3,660.57 • In addition, His house would be paid off 2.5 years earlier than if he paid only the scheduled amount for his 15 year loan. Math 1050 Term Project Group 4 Presentation

  12. Conclusions • The sooner you pay off debts the more money you save in the long run • The amount the down payment put down and the monthly payment control how long you have debt • There is a linear relationship between the loan amount and the total interest paid. • Even a hundredth of a percent makes a big dollar difference when it comes to interest rates. Math 1050 Term Project Group 4 Presentation

  13. Conclusions Cont. • The interest difference between a 15 year loan and a 30 year loan is more than twice the amount • It’s rather 2.5-3 times the amount of interest. Math 1050 Term Project Group 4 Presentation

  14. Participation • Group Leader: Katelyn Merkley • Facts and Figures: Katelyn Merkley, Scott Johnson, Spencer Wolford • PowerPoint: Katelyn Merkley • Pros and Cons: Scott Johnson • Conclusions: Scott Johnson, Katelyn Merkley • Group Discussion Questions: Katelyn Merkley, Spencer Wolford, Scott Johnson Math 1050 Term Project Group 4 Presentation

More Related