Bucky Badger is considering an investment in a small retail…

Bucky Badger is considering an investment in a small retail building with three stores. Mr. Badger estimates the building will generate $300,000 in gross income with operating expenses of $175,000 and a $35,000 CAPEX or improvement allowance next year. If the asking price of the property is $650,000, what would Mr. Badger’s going-in cap rate be if he paid the asking price for the building?

A borrower has secured a 30-year, $150,000 loan at 7 percent…

A borrower has secured a 30-year, $150,000 loan at 7 percent with monthly payments. Fifteen years later, the borrower has the opportunity to refinance with a 15-year mortgage at 6 percent. However, the upfront fees, which will be paid in cash, are $2,500. What is the return on investment if the borrower expects to remain in the home for the next fifteen years?