Calculator Problem – 12/30/2013

You purchase a house for $50,000 with $10,000 down and the balance carried back at 4% amortized over thirty years.  You sell the house for $60,000 with $5,000 down and the balance carried back at 6% amortized over thirty years.  What is the return on your investment?

(If you don’t know how to do this with your calculator, I highly recommend our Money Not Math class that we will be having at the end of February in Santa Ana, California.  A shameless plug for the class but this tool is too important to your financial future that you really need to master what it can do.)

(The answer will be posted with the new calculator problem in 2 weeks. Or if you can’t wait that long, you can go to https://www.facebook.com/garyjohnstonseminars for the answer.)

Answer for 12/16/2013 problem:
(N=360,I=10,PV= -2000,PMT=0) FV=$39,674.80
(N=30,I=10,PV= -2000,PMT=0)  FV= $34,898.80 (change calculator setting to annual)
Difference                                           $  4,776.00