ur friend Bob is a surgeon with student debt of $200,000 at an interest rate of 7%. Bob lives in a apartment and pays $1950 a month. He is considering buying a house from his friend Tom for $424,500 with no down payment. Tom's family has owned the house for decades, and they offered to financing it for Bob over a 360 month term. They haven't discussed an interest rate yet. Should Bob accelerate paying off his student loan and save money, or should he consider making payments towards a new house? Assume the house will n
ur friend Bob is a surgeon with student debt of $200,000 at an interest rate of 7%. Bob lives in a apartment and pays $1950 a month. He is considering buying a house from his friend Tom for $424,500 with no down payment. Tom's family has owned the house for decades, and they offered to financing it for Bob over a 360 month term. They haven't discussed an interest rate yet. Should Bob accelerate paying off his student loan and save money, or should he consider making payments towards a new house? Assume the house will n
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter14: Planning For Retirement
Section: Chapter Questions
Problem 2FPE
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Your friend Bob is a surgeon with student debt of $200,000 at an interest rate of 7%. Bob lives in a apartment and pays $1950 a month. He is considering buying a house from his friend Tom for $424,500 with no down payment. Tom's family has owned the house for decades, and they offered to financing it for Bob over a 360 month term. They haven't discussed an interest rate yet.
Should Bob accelerate paying off his student loan and save money, or should he consider making payments towards a new house? Assume the house will not change in value, and assume the rate of inflation stays stagnant at 3%.
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