adjust the mortgage amount to reflect the points paid (PV = $60,000 －2%). All other values remain the same (term is 30 years; no future value).

Keys:Display:



@c

e   

30@ 

11.5

60000 

0 



R

2%- 



Description:

If necessary, sets 12 payments per year and End mode.

Figures and stores number of payments.

Stores interest rate and amount of loan.

No balloon payment, so future value is zero.

Borrower’s monthly payment.

Stores actual amount of money received by borrower into PV.

Calculates APR.

Example: Loan from the Lender’s Point of View. A $1,000,000 10-year, 12% (annual interest) interest-onlyloan has an origination fee of 3 points. What is the yield to the lender? Assume that monthly payments of interest are made. (Before figuring the yield, you must calculate the monthly PMT = (loan x 12%) ⎟ 12 mos.) When calculating the I%YR, the FV (a balloon payment) is the entire loan amount, or $1,000,000, while the PV is the loan amount minus the points.

F: RPN: Selected Examples 277

File name : English-M02-1-040308(Print).doc Print data : 2004/3/9