girasol2525 asked:
Ramon owns a home that was appraised for $132,600. The balance remaining on his existing mortgage is $43,260. Ramon’s credit union is willing to loan an amount up to 70% of the appraised value of a home. Based on this information, what is the maximum potential amount of credit that’s available to ramond for a home equity loan?
Manuel
Ramon owns a home that was appraised for $132,600. The balance remaining on his existing mortgage is $43,260. Ramon’s credit union is willing to loan an amount up to 70% of the appraised value of a home. Based on this information, what is the maximum potential amount of credit that’s available to ramond for a home equity loan?
Manuel
Laura
Start with the appraised value and multiply that by .7
$132,000 * .7 = $92,820.
This is the amount of credit which the Credit Union will make available.
Now, if you mean how much additional can Ramon borrow, then you have to deduct the existing mortgage:
$92,820 – $43,260 = $49,560.
Since the CU will be more than happy to pay off the first mortgage and carry the entire loan, the potential amount of credit would be the $92,820.