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Response to Egalitarian Thug (Reply #80)

Wed Aug 14, 2013, 12:27 PM

85. Just give me your formula

 

You say you have a fee based model for pricing mortgages that is not based on the time value of money. The formula for pricing a mortgage (a form of annuity) is pretty straight forward. A = amount of payment, N = number of payments, P = amount to be amortized, and i = interest rate. So you get a pretty simple formula of:

A = P ( i + i / (1 + i ) ^ n - 1)

That's nothing arcane just the basic formula everyone learns in finance. So just shoot me the variables in your formula to start with if it's that complicated. Just identifying what variables you are (or are not) using should be enlightening.

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