User manual TEXAS INSTRUMENTS BA REAL ESTATE

[. . . ] BA Real EstateTM Financial Calculator Guidebook Key Index To find information about a specific key, refer to the page number next to the key. ON/C 2nd N 88 16 16 69 84 84 CPT P/ Y 85 17 16 69 52 72 AMORT 46 LOAN #PD PITI 29 OFF TERM V1 I% V2 16 69 29 72 32 BGN/ END 17 CLR TVM 16 16 16 PMT FV APPREC 69 90 72 74 x 89 89 QUAL INC 53 TAX&INS$ 29 QUAL LA NOM PRICE EFF % PDS/ YR x 2 89 18 92 18 92 18 87 BI-WKLY 40 ARM APR INS % i 89 STO TAX % 7 4 1 ROUND 91 8 5 2 FIX 86 9 89 RCL DEBT % 6 e 3 e 89 89 INC % 18 87 000 0 q 89 BUSINESS ANALYST BA Real Estateé FINANCIAL CALCULATOR GUIDEBOOK Guidebook Developed by: The staff of Texas Instruments Instructional Communications With Contributions by: Dave Caldwell Charlotte Clark Bob Fedorisko Mike Keller Jackie Quiram Tammy Richards Gary Rouse This digital apparatus does not exceed the Class B limits for radio noise emissions from digital apparatus set out in the Radio Interference Regulations of the Canadian Department of Communications. © 1993, 1996 Texas Instruments Table of Contents This guidebook begins with a section designed to help you quickly learn about the BA Real Estate TM calculator and its capabilities. The remainder of the book contains examples of and information about specific kinds of financial calculations. General calculator operation and service information are discussed in the Appendix. Getting Started Getting Started . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Calculating Total Payment (PITI) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . [. . . ] Once it is apparent that the savings will be exhausted in a given year, divide the monthly costs into the previous year's total savings. This will tell you how many months will occur during that period before the savings are exhausted. (See lines 19 to 22 in the worksheet example on page 39. ) Mortgages and Amortization 37 Comparing an ARM to a Fixed-Rate Mortgage (Cont. ) Adjustable Rate Mortgage vs. Use the Adjustable Rate Mortgage worksheet to calculate the payments for each adjustment period of the ARM and record those values in steps 4, 9, 15, and 21 respectively. Use the Mortgage Payment--Principal and Interest worksheet to calculate the payment for the fixed-rate mortgage and record that value in steps 3, 8, 14, and 20. Multiply monthly savings/costs by the number of months in the initial ARM period. Multiply monthly savings/costs by number of months in this adjustment period. Record accumulated savings/costs. ]3 X j O 12 j X j $. 1, 013. 86 t $778. 39 $235. 47 $2825. 65 Tg O 12 j $2, 825. 65 $. 1, 013. 86 t $960. 21 $53. 65 $643. 81 a]g jTg $2, 825. 65 $3, 469. 46 38 Mortgages and Amortization 14. Multiply monthly savings/costs by number of months in this adjustment period. Multiply monthly savings/costs by number of months in this adjustment period. Record total savings/costs. ]3 X j O 12 j $. 1, 013. 86 t $1, 153. 34 $. 139. 48 $. 1, 673. 75 a]g jTg ]3 X j O 12 j $3, 469. 46 $1, 795. 72 $. 1, 013. 86 t $1, 354. 86 $. 341. 00 $. 4, 091. 99 a]g j $1, 795. 72 $. 2, 296. 27 Continue the comparison until the accumulated savings in the last column are reduced to or below zero. Once it is apparent that the savings will be exhausted in a given year, divide the monthly costs into the previous year's total savings. This will tell you how many months will occur during that period before the savings are exhausted. Mortgages and Amortization 39 Bi-Weekly Mortgage Payments You can find the effect of making bi-weekly payments (26 half-payments per year) instead of monthly payments. Values Used by the Model To calculate bi-weekly payments, set up the current mortgage in the TVM model and then press L. The calculator uses the TVM values to compute the results. Name PMT= N= YRS= SAV= Meaning The bi-weekly payment required. The interest saved (rounded to the nearest dollar) in comparison with monthly payments. Press j repeatedly to display each result. This PMT tells you what the bi-weekly payment would be. 40 Mortgages and Amortization Benefits of Bi-weekly Payments Making bi-weekly payments instead of monthly payments allows you to pay off a loan more quickly and thus reduce the amount of interest paid. This is because the payments are more frequent and you are making 13 full monthly payments annually instead of 12. Compare that payment to the payment for the same loan if you elected to pay off the loan with bi-weekly payments of $421. 91. The loan would be paid off in less than 23 years, and you would save $54, 498 in interest. Mortgages and Amortization 41 Calculating a Mortgage with Bi-Weekly Payments You are borrowing $115, 000 at 8% for 30 years. What will be the effects and savings if you pay off the loan with bi-weekly payments, instead of monthly payments? Solution Press # , until the BGN indicator disappears. Steps Keystrokes Display 0. 00 P/Y = C/Y = 12. 00 12. 00 12. 00 Clear TVM values. #- Set P/Y and C/Y to 12. 30 0 81 115 q 2 Show bi-weekly payment amount, number of payments, years to pay off the loan, and interest saved. [. . . ] For example, pressing 340 3 has the same effect as pressing 340 T 3. Keystrokes 5 Tg Display MEM= M M Comments 5. 00 60. 00 60. 00 5. 00 0. 00 60. 00 O 12 j #* ]g 0 Tg N= MEM= MEM= N= M M T key not required. Clear user memory. ]#* ]#7 Error Percent-change model not active. 92 Operation, Service, and Warranty Battery Information The BA Real Estate calculator cannot hold data in memory when the batteries are removed or become discharged. Type of Battery to Use The calculator uses two of any of the following batteries. · For up to 1000 hours of operation, use Panasonic LR-44, Ray-O-Vac RW-82, Union Carbide (Eveready) A-76, or equivalent battery types. For up to 2500 hours of operation, use Mallory 10L14 or D357, Union Carbide (Eveready) 357, Panasonic WL-14, Toshiba G-13, Ray-O-Vac RW-42, or equivalent battery types. · Replacing the Batteries 1. Caution: Avoid contact with other calculator components while changing batteries. [. . . ]