HP 12c Platinum Reference Manual page 11

12c platinum / 12C
RPN Keystrokes
gK99ga
~gK
~ga
~gK
2ga
gFgK
39ga
~129963.35+
gK
fL12§
If you, as a lender, know the yield on the entire transaction, and you wish to obtain the
payment amount on the wrap-around mortgage to achieve this yield, use the following
procedure. Once the monthly payment is known, the borrower's periodic interest rate may
also be determined.
1. Press the g and press fCLEARG.
2. Key in the remaining periods of the original mortgage and press n.
3. Key in the desired annual yield and press gC.
4. Key in the monthly payment to be made by the lender on the original mortgage and
press ÞP.
5. Press $.
6. RPN: Key in the net amount of cash advanced and press +Þ$.
6. ALG: Press +, key in the net amount of cash advanced and press ³Þ$.
7. Key in the total term of the wrap-around mortgage and press n.
8. If a balloon payment exists, key it in and press M.
9. Press P to obtain the payment amount necessary to achieve the desired yield.
10. Key in the amount of the wrap-around mortgage and press Þ$¼ to obtain the
borrower's periodic interest rate.
Example 3: Your firm has determined that the yield on a wrap-around mortgage should
be 12% annually. In the previous example, what monthly payment must be received to
achieve this yield on a $200,000 wrap-around? What interest rate is the borrower paying?
12c platinum
ALG Keystrokes
99ga
~gK
~ga
~gK
2ga
1681.71gK
39ga
~+129963.35
gK
fL§12³
Real Estate
Display
The above cash flow
occurs 200 times.
Next cash flow
1,681.71
received by lender.
Cash flow occurs 39
39.00
times.
Final cash flow.
131,645.06
Rate of return to
11.84
lender.
11
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