Variable Rate Mortgages - HP 12c Platinum Reference Manual
Hp 12c platinum: reference guide
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Also See for 12c Platinum:
- User manual (288 pages) ,
- Owner's handbook manual (213 pages) ,
- Solutions handbook (166 pages)
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Lending
12c platinum / 12C
RPN Keystrokes
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Variable Rate Mortgages
As its name suggests, a variable rate mortgage is a mortgage loan which provides for
adjustment of its interest rate as market interest rates change. As a result, the current
interest rate on a variable rate mortgage may differ from its origination rate (i.e., the rate
when the loan was made). This is the difference between a variable rate mortgage and the
standard fixed payment mortgage, where the interest rate and the monthly payment are
constant throughout the term.
Under the agreement of the variable rate mortgage, the mortgage is examined periodically
to determine any rate adjustments. The rate adjustment may be implemented in two ways:
1. Adjusting the monthly payment.
2. Modifying the term of the mortgage.
The period and limits to interest rate increases vary from state to state.
Each periodic adjustment may be calculated by using the HP 12C Platinum with the
following keystroke procedure. The original terms of the mortgage are assumed to be
known.
1. Press g and press fCLEARG.
2. Key in the remaining balance of the loan and press $.
The remaining balance is the difference between the loan amount and the total
principal from the payments which have been made.
To calculate the remaining balance, do the following:
a. Key in the previous remaining balance. If this is the first mortgage adjustment,
this value is the original amount of the loan. Press $.
b. Key in the annual interest rate before the adjustment (as a percentage) and press
gC.
12c platinum
ALG Keystrokes
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Display
Year 3
3.00
3rd year monthly payment.
-494.89
Remaining balance after 3rd
-52,215.34
year.
Year 4
4.00
4th year monthly payment.
-519.64
Remaining balance after 4th
-52,523.86
year.
Year 5
5.00
5th year monthly payment.
-545.62
Remaining balance after 5th
-52,542.97
year.
Monthly payment for
-572.90
remainder of term.
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