(E) Mortgage. Assume you are wealthy and credit-worthy enough to buy the house you've chosen in part (C). You will put 10% down, and get a mortgage for the rest. Choose a 30-year, fixed rate mortgage. (Be sure to pick a "jumbo" loan if your mortgage amount is over the limit.) What are the terms (interest rate, points, fees, and so on)? Use your numbers and the formulas from the book and your scientific calculator to figure out the payment for the total principal- and-interest each month under the mortgage. You only need the total principal-and-interest monthly payment; you do not need to show how much of each monthly payment is principal and how much is interest. (You may use an online mortgage calculator to confirm your calculations, but you must show me the computations.) (F) Mortgage, real life. Because you're putting down less than 20%, you will have to pay Private Mortgage Insurance (PMI) each month. This will cost an additional 10% of the principal-and- interest payment each month. You will also have to pay a monthly amount to an escrow account, which will cover your homeowners' insurance and your property taxes. Assume that the homeowners' insurance is $900 per year, and the property taxes are 1.08% of the value of your house per year. (Use the price of your house as its value.) What will your total monthly mortgage payment really be?
