Lecture 4: Whats the deal with Loans


Introduction


Part 1


Part 2


Part 3



Assignment 4

Build your skills by doing these exercises on your own.

  1. Get on the web and find a couple of sites that are offering home mortgages. Compare the rates on a 15-year versus a 30-year fixed rate mortgage – are they the same? Then look at the same rates on adjustable 15-year and 30-year mortgages. What have you learned?

  2. Find a “mortgage calculator” website that allows you to calculate your fixed monthly payment on a 30-year mortgage at rates of 5% and 10% using the annuity formula approach.

  3. On the web, find a site where you can review the terms and conditions of various car loans. If you have time, visit a reputable car dealer, tell them you are doing some research on car loans (which you are!), and see if one of their financing specialists will spend a few minutes with you explaining the process. This way, you’ll have some experience when you go buy a car for real and want to finance it with a car loan.