Please forgive me, but I am appealing to you to please solve these 6 problems for me in the most simpler of steps that I can use to practice. Thanks so much. Garnett

1. Purchaser applies for an FHA loan to buy home for $102,000. FHA guarantees 97% of first $25,000 of purchase price and 95% of the balance. Lender charges three points (3%) to be paid at closing. How much cash will be advanced to purchaser?

2. Joe borrows 80% of purchase price of home at 9% interest.What is price of home if first monthly payment of interest is $265?

3. Andy sells home through broker for 7% commission. Andy nets $6,500 after paying existing mortgage of $23,400 and tax lien of $512.00. What did Andy's house sell for?

4. Property at end of 3 years is valued at $82,500. It depreciated 2.5% during each of 3 years. What was original value?

5. Store is leased with agreement at a monthly rent of $300 plus 4.5% of the gross income over 200,000. Lessee pays total rent of $4,725 for 2008. What was gross amount of Lessee's business for 2008?

6. Mary sells property for $150,000 and realizes a 20% return on investment. How much did she originally pay for property?

Again, thanks so much for your help.

1. Cash Adv. = 0.97*25000 + 0.95*(102000-25000) = 24,250 + 73,150 +

0.03*102000 = $100,460.

2. Purchase price = $P.
lOAN Amount = $0.8P.
I = 0.8P*.09*(1/12) = $265.
0.006P = 265,
P = $44,166.67 = Purchase price.

3. Selling price = $X.
Commmission = $0.07X.

X - 0.07X - 23,400 -512 = $6500,
0.93X - 23,912 = 6500,
0.93X = 30,412,
X = 32,701.08.

4. Po - 0.025*3Po = $82,500,
0.925Po = 82,500,
Po = $89,189.19. = Initial value.

5. C=$300 + 0.045(G - $200,000)=$4725.
300 + 0.045G - 9000 = 4725,
G = $298,333.33 = Gross income.

6. Po + 0.2Po = $150,000,
1.2Po = 150,000,
Po = $125,000. = Original price.

Thanks greatly, Henry. May God bless your soul.

G

No problem, Garnett! I'd be happy to walk you through each problem step-by-step.

1. To find out how much cash will be advanced to the purchaser, we need to calculate the amount guaranteed by the FHA, deduct the lender's points, and then subtract that amount from the purchase price.

First, calculate the amount guaranteed by the FHA:
- First, find 97% of the first $25,000: 0.97 * $25,000 = $24,250
- Then find 95% of the balance ($102,000 - $25,000): 0.95 * $77,000 = $73,150
- Add the two amounts together: $24,250 + $73,150 = $97,400

Next, deduct the lender's points:
- Calculate 3% of the purchase price: 0.03 * $102,000 = $3,060

Finally, subtract the lender's points from the amount guaranteed by the FHA:
$97,400 - $3,060 = $94,340
So, $94,340 will be advanced to the purchaser.

2. To find the price of the home, we need to calculate the loan amount based on the monthly payment, interest rate, and down payment.

First, calculate the loan amount:
- Multiply the monthly payment by 12 to get the annual payment: $265 * 12 = $3,180
- Divide the annual payment by the interest rate (9% = 0.09): $3,180 / 0.09 = $35,333.33

Next, calculate the down payment:
- Multiply the down payment percentage (80%) by the price of the home: 0.80 * Price = $35,333.33
- Divide both sides of the equation by 0.80: Price = $35,333.33 / 0.80
- Price = $44,166.67
So, the price of the home is $44,166.67.

3. To determine the selling price of Andy's house, we need to calculate the total costs subtracted from the amount Andy nets.

First, calculate the total costs:
- Add the existing mortgage and tax lien: $23,400 + $512 = $23,912

Next, calculate the selling price:
- Add the total costs to the net amount: Selling Price + $23,912 = $6,500
- Subtract both sides by $23,912: Selling Price = $6,500 - $23,912
- Selling Price = -$17,412
Since the selling price cannot be negative, we can conclude that Andy may have had a loss or made an error in the calculations.

4. To find the original value of the property, we need to calculate the value after 3 years of depreciation.

First, calculate the depreciation percentage per year:
- Find the inverse of the depreciation rate: 100% - 2.5% = 97.5%
- Convert the percentage to decimal form: 97.5% = 0.975

Next, calculate the value after 3 years:
- Multiply the original value by the depreciation rate for each year: Original Value * (0.975) * (0.975) * (0.975) = $82,500
- Simplify: Original Value * (0.975)^3 = $82,500
- Divide both sides by (0.975)^3: Original Value = $82,500 / (0.975)^3

5. To determine the gross amount of the Lessee's business for 2008, we need to calculate the amount paid as rent and subtract the fixed monthly rent.

First, calculate the total amount paid as rent:
- Subtract the fixed monthly rent from the total rent paid: Total Rent - (Monthly Rent * 12) = $4,725 - ($300 * 12) = $4,725 - $3,600 = $1,125

Next, calculate the gross amount of the Lessee's business:
- Multiply the difference by 100 and divide by the percentage of the gross income: Gross Income = ($1,125 * 100) / 4.5

6. To find out how much Mary originally paid for the property, we need to calculate the original investment amount based on the given return on investment.

First, calculate the return on investment in decimal form: 20% = 0.20

Next, calculate the original investment amount:
- Divide the selling price by the return on investment: Original Investment = $150,000 / 0.20

I hope these explanations help you practice and understand how to solve these problems! Let me know if you have any other questions.