HP 12C Financial calculator - Manual (Page 125)

Section 12: Real Estate and Lending 125
File name: hp 12c_user's guide_English_HDPMBF12E44 Page: 125 of 209
Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm
Example 1: A borrower is charged 2 points for the issuance of his mortgage. If
the mortgage amount is $60,000 for 30 years and the interest rate is 11
1 /
2
% per
year, with monthly payments, what true annual percentage rate is the borrower
paying? (One point is equal to 1% of the mortgage amount.)
Keystrokes Display
gÂ
fCLEARG
30gA 360.00 Months (into n)
11.5gC 0.96 Percent monthly interest rate (into i).
60000$ 60,000.00 Loan amount (into PV).
P –594.17 Monthly payment (calculated).
:$2b-$ 58,800.00 Actual amount received by borrower
(into PV).
¼ 0.98 Percent monthly interest rate
(calculated).
12§ 11.76 Annual percentage rate.
Example 2: Using the same information as given in example 1, calculate the
APR if the mortgage fee is $150 instead of a percentage.
Keystrokes Display
gÂ
fCLEARG
30gA 360.00 Months (into n)
11.5gC 0.96 Percent monthly interest rate (into i).
60000$ 60,000.00 Loan amount (into PV).
P –594.17 Monthly payment (calculated).
:$150-$ 59,850.00 Effective mortgage amount (into PV).
¼ 0.96 Monthly interest rate (calculated).
12§ 11.53 Annual percentage rate.