Unit 8 Instructor Graded Assignment Essay

699 Words Nov 4th, 2014 3 Pages
Unit 8: Instructor Graded Assignment
Mortgages

In this and future Instructor Graded Assignments you will be asked to use the answers you found in the Unit 1 Assignment.

Note: For these questions you need to cite a reliable source for information, which means you cannot use sites like Wikipedia, Ask.com®, and Yahoo® answers. If you do use those sites the instructor may award 0 points for your response.

The Assignment problems must have the work shown at all times. The steps for solving the problems must be explained. Failure to do so could result in your submission being given a 0. If you have any questions about how much work to show, please contact your instructor.

Assignments must be submitted as a Microsoft Word®
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Question 3
(10 points)
3. You find a great deal for your house! The bank agrees to give you a 5 year loan where you only pay $100 a month, and at 0% interest. What can go wrong? However, when 5 years pass you realize you agreed to a balloon mortgage, and all the rest of that loan is due right now. How much do you need to pay for your final (60th) payment? Explain how you got your answer and your reasoning behind it.

Essay
(15 points)
4. Mortgages come in many different types. There are fixed rate mortgages, ARM mortgages, and balloon mortgages to name a few.

Research fixed rate, ARM mortgages and balloon mortgages, then write an essay comparing them. What are some of the advantages and disadvantages of each? When might you find one type of mortgage loan beneficial over the other two?

Requirements for essay * Write your essay in this document – do not save it in a separate file. * You must clearly state your position with well-structured paragraphs using proper grammar, spelling, and sentence structure. * This is not an “opinion” question – you must offer evidence to support your position, using properly-cited sources * Your answer must be between ¾-1 page in length. * You must cite and reference at least one source (book, website, periodical) using APA format. * Do not use unreliable sources such as Wikipedia, and Yahoo!

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