BORROWING TO BUY A HOME - GST BOCES

BORROWING TO BUY A HOME

LESSON 6.1 Down Payments and Closing Costs

Purchase Price ? Down Payment = Mortgage Loan

Down Payment + Closing Costs = Cash Needed to Buy a Home

2

Mortgage Loan Interest Costs

Number of Months Per Year x Number of Years of Mortgage = Total Number of Payments Monthly Payment x Number of Payments = Total of Mortgage Payments Total of Mortgage Payments - Amount of Mortgage = Interest Paid

3

Refinancing a Mortgage

Number of Months Per Year x Old Monthly Payment = One Year's Payment-Old Mortgage Number of Months Per Year x New Monthly Payment = One Year's Payment-New Mortgage Old Mortgage Payment ? New Mortgage Payment = Difference in Yearly Payments Total Closing Costs + Prepayment Penalty = Total of Closing Costs and Prepayment Penalty Difference in Yearly Payments ? Total Closing Costs and Penalty = Amount Saved First Year

4

RENTING OR OWNING A HOME

LESSON 6.2 Costs of Home Ownership

Total Expenses ? Tax Reductions = Net Cost for First Year

Costs of Rental Property

Number of Months Per Year x Monthly Rent = Yearly Rent

Yearly Rent + Annual Expenses = Total First Year Costs

5

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