Pocket Reference Guide Model 3405 RESIDENTIAL REAL ESTATE FINANCE CALCULATOR REAL ESTATE MASTER IIIX ® This equipment has been certified to comply with the limits for a Class B computing device, pursuant to Subpart J of Part 15 of FCC rules. Software copyrighted and licensed to Calculated Industries, Inc. by Real Estate Master Technologies, LLC, 2004. Pocket Reference Guide copyrighted by Calculated Industries, Inc. © 2004.
3405PRG-E-B 1/9/04 8:45 AM Page 1 REAL ESTATE MASTER® IIIX The REAL ESTATE MASTER IIIX calculator lets you perform mortgage loan and financing problems with ease! Quickly Solve: • Time-Value-of-Money (TVM) Problems: Find Loan Amount, Term, Interest, Payment, Future Value • Property Tax, Homeowner’s Insurance, Mortgage Insurance • P&I, PITI & Interest-Only Payments • Sales Price and Down Payment • Rent vs.
405PRG-E-B 1/9/04 8:45 AM Page 2 TABLE OF CONTENTS KEY DEFINITIONS .................................4 Preference Settings — How to Access ...............................................9 EXAMPLES ...........................................11 Memory — Add/Subtract/Multiply ......11 Memory/Storage Registers................12 Finding Commission ..........................12 Reduction of Listing Price..................13 Date of Escrow Closing .....................13 Monthly Mortgage (P&I) Payment .....
3405PRG-E-B 1/9/04 8:45 AM Page 3 Amortization for Individual Year(s)— Month Offset, Tax Bracket Change ...26 Balloon Payment/Remaining Balance............................................28 APR and Total Finance Charges, Including Mortgage Insurance .........29 Prepaid (Odd-Days) Interest and APR, Including Mortgage Insurance .........30 Appreciation/Future Value .................32 Bi-Weekly Loans................................33 80:10:10 Combo Loan vs. Fixed-Rate Loan with Mortgage Insurance........
3405PRG-E-B 1/9/04 8:45 AM Page 4 KEY DEFINITIONS : Colon separator (used for dates, ARMs, Amortization ranges, and Combo loans) b Backspace key; for backing up/deleting wrong entry ® Recalls or re-displays a value when followed by a chosen key (e.g.
3405PRG-E-B 1/9/04 8:45 AM Page 5 sx Clear All (Note: perform with caution as it will clear/reset stored values) s= Preference mode (see pg. 9 for details) s÷ Payments per year (Default 12, for monthly) sb Periodic (identifies entry as periodic instead of yearly) s) Month offset s: Odd-days interest s+ Tax bracket % sp Estimated tax savings/after-tax payment sP Rent vs.
3405PRG-E-B 1/9/04 8:45 AM Page 6 sˆ APR (annual percentage rate), including mortgage insurance, if entered P Sales price of property d Down payment sT Bi-Weekly loan a Amortization function sa Remaining balance A Adjustable-rate mortgage sA ARM decreasing interest % adjustment s% ARM lifetime interest cap t Property tax (enter as percent or dollar amount)* I Property/homeowner’s insurance (enter as percent or dollar amount)* POCKET REFERENCE GUIDE — 6
3405PRG-E-B sI 1/9/04 8:45 AM Page 7 Mortgage insurance (enter as percent or dollar amount)* *Note: Once Tax/Insurance % (or $) values are entered — as well as TVM values — the second press of t I, or press of s I I will compute the $ (or %); third press finds monthly amounts sd For entering (or finding) Loan-to-Value ratio and computing respective Down Payment and/or Loan Amount ! Used to enter 1st TD interest:term for Combo Loans s! Used to enter 2nd TD interest:term for Combo Loans POCKET REF
3405PRG-E-B * 1/9/04 8:45 AM Page 8 Combo loan function for an 80:10:10 LTV loan; calculates 1st/2nd TD values and compares them to entered fixed-rate loan w/mortgage insurance *You may enter any LTV prior to pressing this key (e.g.
3405PRG-E-B 1/9/04 8:45 AM Page 9 Preference Settings — How to Access Press s, then =, then keep pressing = to toggle through the main settings. Press the + key to advance within subsetting. Use the – key to back up. Press any key to exit mode. Press s and then: 1st press of = + Decimal Places: --Off 0.00 (returns to 2 decimal places @ Off) --Permanently holds decimal place setting 2nd press = Payments Per Year: --Returns to 12 @ Off) + --Holds payments/year 3rd press = Tax/Ins.
3405PRG-E-B 1/9/04 8:45 AM Page 10 (Cont’d) 4th press = Mortgage Insurance (Cleared or Stored): --Clears MI ($ or %) @ oo + --Clears MI ($ or %) @ Off + --Holds only MI % at Off + --Holds MI ($ or %) 5th press = Amortization Display Range: --ENT-ENT (amortizes for entered year)* + --1-ENT (amortizes from beginning to entered year)** 6th press = Qualifying Ratios: --Display at first press of q or Q keys + --Display at end of qualifying sequence *e.g.
3405PRG-E-B 1/9/04 8:45 AM Page 11 EXAMPLES Memory — Add/Subtract/Multiply Add 1,500 and 2,650 to the cumulative Memory (M+). Compute subtotal, then subtract 2,000 and find total. STEPS KEYSTROKES DISPLAY oo 0.00 1 5 0 0 µ M 1,500.00 2 6 5 0 µ M 2,650.00 ®µ M 4,150.00 2)sµ M 2,000.00 Find total and clear Memory ®® 2,150.00 Clear Add 1st # Add 2nd# Find total Subtract Store 55 and multiply by 40. Then recall Memory Total and multiply it by 60.
3405PRG-E-B 1/9/04 8:45 AM Page 12 Memory/Storage Registers Store 10, 20, 30 into Memory Storage keys M0-M2 and recall each value. Then clear all stored numbers. STEPS KEYSTROKES Clear Store 1st # oo 10s®0 M-0 20s®1 M-1 30s®2 M-2 ®0 M-0 Store 2nd # Store 3rd # Recall 1st # DISPLAY 0.00 10.00 20.00 30.00 10.00 (Repeat for 1 and 2) Clear All s x “All Cleared” 0.00 Note: There are additional Storage Registers s ® 3, 4, 5 and 6. You cannot store more than one value in the Storage Registers.
3405PRG-E-B 1/9/04 8:45 AM Page 13 Reduction of Listing Price A seller is anxious to sell his home and wishes to reduce the listing price by 5%. What is the new price, if it is now listed at $346,000? STEPS KEYSTROKES Clear oo Enter price 346) Subtract 5% – 5 % Find new listing price = DISPLAY 0.00 346,000. 17,300.00 328,700.
3405PRG-E-B 1/9/04 8:45 AM Page 14 Monthly Mortgage (P&I) Payment Find the monthly (P&I) payment on a 30year, fixed-rate loan of $265,000 at 6.75% annual interest: STEPS KEYSTROKES DISPLAY oo 0.00 265)l 265,000.00 Enter term 30T 30.00 Enter interest 6 • 7 5 ˆ 6.75 Find payment p 1,718.
3405PRG-E-B 1/9/04 8:45 AM Page 15 Interest Rate Find the interest rate on a mortgage if the loan amount is $98,500, term is 30 years and payment is $1,150 a month: STEPS KEYSTROKES DISPLAY oo 0.00 98500l 98,500.00 Enter term 30T 30.00 Enter payment 1 1 5 0 p 1,150.00 Find annual interest ˆ 13.78 Find periodic interest ˆ 1.15 Loan Amount Approximately how much can you borrow if the interest rate is 6.
3405PRG-E-B 1/9/04 8:45 AM Page 16 Loan Amount Based on Sales Price and Down Payment Find both down payment dollar amount and loan amount if the sales price is $375,500 and you're planning to put 20% down: STEPS KEYSTROKES DISPLAY oo 0.00 375500P 375,500.00 Enter down% 2 0 d* 20.00 Find down$ d 75,100.00 Find loan l 300,400.00 Clear Enter price *You do not have to label the value as a percent. Loan-to-Value Find the LTV if the sales price is $265,500 and the down payment is $15,000.
3405PRG-E-B 1/9/04 8:45 AM Page 17 Setting Tax and Insurance Enter an annual property tax rate of 1.5%, a property/homeowner’s insurance rate of 0.25% and a mortgage insurance rate of 0.50%: STEPS KEYSTROKES DISPLAY Set tax%* 1•5t Set insurance% • 2 5 I Set mortgage insurance% • 5 0 s I 1.50 0.25 0.50 *Note: Do not label as a percent, or use the % key; it is automatically registered as a percent.
3405PRG-E-B 1/9/04 8:45 AM Page 18 P&I, PITI and Interest-Only Payments • • • • • • • Term: 30 years Interest: 6.25% Sales price: $325,000 Down payment: 5% Property tax: 1.3% Property insurance: 0.25% Mortgage insurance: 0.45% STEPS KEYSTROKES DISPLAY oo 0.00 30T 30.00 6•25ˆ 6.25 325)P 325,000.00 Down% 5d 5.00 Set tax%* 1•3t 1.30 Set insurance% • 2 5 I 0.25 Set MI% •45sI 0.45 Find loan l 308,750.00 Find P&I payment p “run” 1,901.03 Find PITI payment p 2,436.60 Find interest-only payment p 1,608.
3405PRG-E-B 1/9/04 8:45 AM Page 19 Quarterly Payment Find the quarterly payment on a 10-year loan of $15,000 with an annual interest rate of 12%: STEPS KEYSTROKES DISPLAY Clear oo 0.00 Set to 4 payments per year 4s÷ 4.00 Enter loan 1 5 ) l 15,000.00 Enter term 10T 10.00 Enter interest 1 2 ˆ 12.00 Find quarterly payment p 648.94 Return to 12 payments per year 12s÷ 12.
3405PRG-E-B 1/9/04 8:45 AM Page 20 Estimated Tax Savings • • • • • • Loan: $150,000 Buyer’s tax bracket: 28% Term: 30 years Interest: 8% Property taxes: $1,500 Property insurance: $250 Note: This is only an estimate. What is this buyer’s estimated income tax savings and “after tax” payment? STEPS KEYSTROKES DISPLAY oo 0.00 term 30T 30.00 interest 8 ˆ 8.00 tax$ 1 5 0 0 t 1,500.00 insurance$ 250I 250.00 Enter loan 150)l 150,000.00 Find P&I payment p “run” 1,100.65 PITI payment p 1,246.
3405PRG-E-B 1/9/04 8:45 AM Page 21 Rent vs. Buy • Term: 30 years Property Tax: 1.25% • Interest: 7.5% Property Ins: 0.35% • Down: 10% Tax bracket: 30% If your client is currently renting at $1,250/month, find the comparable home price, loan and estimated income tax savings (at 30% tax bracket). STEPS KEYSTROKES DISPLAY oo 0.00 term 30T 30.00 interest 7 • 5 ˆ 7.50 down 10d 10.00 tax% 1•25t 1.25 insurance% •35I 0.35 Tax bracket 30s+ 30.00 Enter rent to find comparable home price 1 2 5 0 s P 221,894.
3405PRG-E-B 1/9/04 8:45 AM Page 22 ARM Payment — Increasing and Decreasing Payments • • • • Loan: $225,000 Term: 30 years Start interest: 4.25% 1st ARM interest adjustment: increases 1% after 6 months • 2nd ARM adjustment: decreases 1.5% at end of 1st year • 3rd ARM adjustment: increases 1.25% at end of 2nd year and continues to increase each year thereafter • ARM Cap: 4% Find ARM payments through year six: STEPS KEYSTROKES DISPLAY oo 0.00 225)l 225,000.00 Enter term 30T 30.
3405PRG-E-B 1/9/04 8:45 AM Page 23 (Cont’d) STEPS KEYSTROKES DISPLAY Find “adjusted” higher payment for next 6 months A “run” 1 1,240.73 Enter 2nd ARM parameters 1 • 5 : 1 s A -1.50 - 1.00 Find Year 2 “adjusted” lower payment A 1 1,047.42 Enter 3rd ARM parameters 1 • 2 5 : 1 A 1.25 - 1.00 Find Year 3 “adjusted” increased payment A 1 1,202.78 Find Year 4 “adjusted” increased payment A 2 1,364.24 Find Year 5 “adjusted” increased payment A 3 1,530.54 Find Year 6 “adjusted” increased payment A 4 1,631.
3405PRG-E-B 1/9/04 8:45 AM Page 24 Amortization — Using “Next” Feature • • • • • Loan: $300,000 Term: 30 years Interest: 7.5% Start Month: January Tax Bracket: 28% (Default) STEPS KEYSTROKES DISPLAY oo 0.00 300)l 300,000.00 Enter interest 7 • 5 ˆ 7.50 Enter term 30T 30.00 Find payment p 2,097.64 Find # payments a 1-360 Find total interest a 455,151.67 Find total principal a 300,000.00 Find total payments a 755,151.
3405PRG-E-B 1/9/04 8:45 AM Page 25 (Cont’d) STEPS KEYSTROKES Find total payments Find balance Remaining term Tax deduction a a a a DISPLAY 25,171.72 297,234.50 29.00 6,273.74* *estimated – mortgage interest only; doesn’t include property tax. Find all values for the second year: STEPS KEYSTROKES Display Year 2 Find total interest Find total principal Find total payments Find balance Remaining term Tax deduction a DISPLAY 13-24 a 22,191.53 a 2,980.20 a a a a 25,171.72 294,254.30 28.
3405PRG-E-B 1/9/04 8:45 AM Page 26 Amortization for Individual Year(s) — Month Offset, Tax Bracket Change • • • • • Loan: $300,000 Term: 30 years Interest: 7.5% Start Month: March Income Tax Bracket: 30% Amortize & find mortgage interest deduction for Year 1, if loan starts in March: STEPS KEYSTROKES DISPLAY Clear oo 0.00 Set Month Start to March 3s) 3.00 Enter tax bracket 30s+ 30.00 Enter loan 300)l 300,000.00 Enter interest 7 • 5 ˆ 7.50 Enter term 30T 30.00 Find P&I payment p 2,097.
3405PRG-E-B 1/9/04 8:45 AM Page 27 (Cont’d) STEPS KEYSTROKES DISPLAY Remaining balance a 297,709.89 Remaining term a 29.17 Mortgage interest deduction/Year 1 (@30% tax bracket) a 5,605.90 Find all values for the 2nd year: Display Year 2 a Find total interest a 11-22 22,228.43 Note: Keep pressing a for Year 3, 4, etc. — With “Next” feature, sequence automatically repeats for next year. Return Month Offset to 1* 1s) Return tax bracket to to 28% 28s+ 1.00 28.
3405PRG-E-B 1/9/04 8:45 AM Page 28 Balloon Payment/Remaining Balance • Loan: $300,000 • Term: 30 years • Interest: 7.5% Find remaining balance after 10 years: STEPS KEYSTROKES DISPLAY oo 0.00 300)l 300,000.00 Enter interest 7 • 5 ˆ 7.50 Enter term 30T 30.00 Find payment p 2,097.64 Find balloon payment, or remaining balance 10sa 260,384.
3405PRG-E-B 1/9/04 8:45 AM Page 29 APR and Total Finance Charges, Including Mortgage Insurance • Loan: $250,000 • Term: 30 years • Interest: 7% • Cost: 1.5 points + $550 • Mortgage insurance (MI): $1,200/year STEPS KEYSTROKES DISPLAY oo 0.00 250)l 250,000.00 Enter term 30T 30.00 Enter interest 7 ˆ 7.00 Find payment p 1,663.26 Enter MI 1200sI 1,200.00 Find Loan Costs: Recall loan ®l 250,000.00 Find points x 1 • 5 % = 3,750.00 Add fees and find total +550= 4,300.00 Find APR sˆ 7.
3405PRG-E-B 1/9/04 8:45 AM Page 30 Prepaid (Odd-Days) Interest and APR, Including Mortgage Insurance • Loan: $350,000 • Term: 30 years • Interest: 6% • Cost: 1.5 points + $750 • Mortgage insurance (MI): $2,200/year • Escrow Closes: 7/21/03 • 1st Payment Due: 8/1/03 STEPS KEYSTROKES DISPLAY oo 0.00 350)l 350,000.00 Enter term 30T 30.00 Enter interest 6 ˆ 6.00 Find P&I payment p 2,098.43 Enter MI 2200sI 2,200.00 Find days between escrow closing and date of 1st payment 8:1:03–7: 21:03= 11.
3405PRG-E-B 1/9/04 8:45 AM Page 31 (Cont’d) Find Loan Costs: STEPS KEYSTROKES DISPLAY Recall loan ®l 350,000.00 Find points x 1 • 5 % = 5,250.00 Add fees and find total +750= 6,000.00 Add prepaid interest stored in memory + ® µ = 6,641.67 Find APR sˆ 6.99 Find total charges ˆ 478,075.33 Amount financed ˆ 343,358.33 Total cost ˆ 821,433.66 P&I payment ˆ 2,098.43 Monthly MI ˆ 183.33 PIMI payment ˆ 2,281.76 Clear All s x “All Cleared” 0.
3405PRG-E-B 1/9/04 8:45 AM Page 32 Appreciation/Future Value What will a $350,000 home be worth in 3 years, figuring an inflation or appreciation rate of 6%? STEPS KEYSTROKES DISPLAY Clear oo 0.00 Set to 1 payment per year 1s÷ 1.00 Enter PV 350)l 350,000.00 Enter term 3T 3.00 Enter approximate rate 6ˆ 6.00 Find FV sl 416,855.60 Reset payments per year 12s÷ 12.
05PRG-E-B 1/9/04 8:45 AM Page 33 Bi-Weekly Loans • Loan: $212,500 • Term: 30 • Interest: 7.85% Find the Bi-Weekly term, savings, interest savings, total cost, and Bi-Weekly payment: STEPS KEYSTROKES DISPLAY oo 0.00 212500l 212,500.00 Enter term 30T 30.00 Enter interest 7 • 8 5 ˆ 7.85 Find P&I payment p 1,537.09 Find Bi-Weekly term sT 22.97 Find total interest savings T 94,305.23 Find total interest paid T 246,545.97 Find total principal T 212,500.00 Find total principal plus interest T 459,045.
3405PRG-E-B 1/9/04 8:45 AM Page 34 80:10:10 Combo Loan vs. Fixed-Rate Loan with Mortgage Insurance Compare an 80:10:10 Combo Loan vs. a Fixed-Rate loan w/mortgage insurance. The loan parameters are: FIXED w/PMI COMBO (1st/2nd) Loan Interest 250,000 6.50% Term 30 PMI LTV 0.62% 95% 250,000 6.00% – 8.50% 30 year– 15 year -80% – 10% STEPS KEYSTROKES DISPLAY 1. Enter Fixed-Rate Loan Values and Find Total Payment: Clear oo 0.00 Enter loan 2 5 0 ) l 250,000.
3405PRG-E-B 1/9/04 8:45 AM Page 35 (Cont’d) STEPS KEYSTROKES DISPLAY Enter interest 6 • 5 ˆ 6.50 Enter term 3 0 T 30.00 Enter MI% • 6 2 s I 0.62 Clear Tax 0t 0.00 Clear Insurance 0 I 0.00 Solve for payment p 1,580.17 Solve for PITI (including PMI) p 1,709.34 2. Enter Combo Loan Values: Enter 1st TD Interest and Term 6 : 3 0 ! 6.00-30.00 Enter 2nd TD Interest and Term 8 • 5 : 1 5 s ! 8.50-15.00 3.
3405PRG-E-B 1/9/04 8:45 AM Page 36 (Cont’d) STEPS KEYSTROKES DISPLAY Find 1st/2nd TD combined monthly payment * 1,605.87 Find equivalent payment for fixed-rate loan with mortgage insurance * 1,709.34 Display monthly savings over fixed-rate loan with mortgage insurance * 103.46 Display adjusted 2nd term (if savings applied to 2nd TD) * 8.71 Find 1st TD loan amount * 222,222.22 Find 2nd TD loan amount * 27,777.78 Find 1st TD payment * 1,332.33 Find 2nd TD payment * 273.54 Redisplay LTV * 80.00-10.
3405PRG-E-B 1/9/04 8:45 AM Page 37 80:15:5 Combo Loan vs. Fixed-Rate Loan with Mortgage Insurance Compare an 80:15:5 Combo Loan vs. a Fixed-Rate loan w/mortgage insurance. The loan parameters are: FIXED w/PMI COMBO 1st/2nd) Loan Interest 350,000 6.00% Term 30 PMI LTV 0.62% 95% 350,000 5.25% – 7.0% 30 year– 15 year -80% – 15% STEPS KEYSTROKES DISPLAY 1. Enter Fixed-Rate Loan Values and Find Total Payment: Clear oo 0.00 Enter loan 3 5 0 ) l 350,000.00 Enter interest 6 ˆ 6.
3405PRG-E-B 1/9/04 8:45 AM Page 38 (Cont’d) STEPS KEYSTROKES DISPLAY Clear Insurance* 0I 0.00 Solve for payment p 2,098.43 Solve for total payment (including PMI) p 2,279.26 *Skip to p if continuing from the last example, as rates are already cleared. 2. Enter Combo Loan Values: Enter 1st TD Interest and Term 5 • 2 5 : 3 0 ! 5.25 - 30.00 Enter 2nd TD Interest and Term 7 : 1 5 s ! 7.00-15.00 3. Find Combo Loan Values: Find blended interest rate for 1st/2nd TD s ** 5.
3405PRG-E-B 1/9/04 8:45 AM Page 39 (Cont’d) STEPS KEYSTROKES DISPLAY Find equivalent payment for fixed-rate loan with mortgage insurance * 2,279.26 Display monthly savings over fixed-rate loan with mortgage insurance * 154.99 Display adjusted 2nd term (if savings applied to 2nd TD) * 9.78 Find 1st TD loan amount * 294,736.84 Find 2nd TD loan amount * 55,263.16 Find 1st TD payment * 1,627.55 Find 2nd TD payment * 496.72 Redisplay LTV * 80.00-15.00 *Use the s * keys to enter another LTV; e.g.
3405PRG-E-B 1/9/04 8:45 AM Page 40 APPENDIX Default Settings Performing a Reset will return your calculator to the default settings below: • 12 Periods per Year • Property Tax/Ins. = % Rates Not Permanently Stored/Clears Upon O • Mortgage Ins. = % Rates Not Permanently Stored/Clears upon o o • Month Offset of January (1) • Two Fixed Decimal Places • Amortization Range = Specified Year (Ent-Ent) Decimal Place Setting To set the no. of decimal places displayed: s s s s s s s s 6 5 4 3 2 1 0 • 0.
3405PRG-E-B 1/9/04 8:45 AM Page 41 Batteries Replacing the Batteries: Slide open and remove the battery door (located on upper backside of calculator). Remove the old batteries. Insert two new LR-44 button-cell batteries, making sure they’re facing positive-side (+) up. Close the battery door. Reset You may at times want to reset your calculator to its factory settings (i.e., reset all registers and Preference Settings to their original default values).
3405PRG-E-B 1/9/04 8:45 AM Page 42 REAL ESTATE MASTER® and CALCULATED INDUSTRIES® are registered trademarks of Calculated Industries, Inc. ALL RIGHTS RESERVED CALCULATED INDUSTRIES® 4840 Hytech Drive Carson City, NV 89706 U.S.A. 1-800-854-8075 Fax: 1-775-885-4949 E-mail: info@calculated.com www.calculated.
