Caiib retail reverse mortgage

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Reverse Mortgage (RML) Numerical Questions :

Value of the property - Rs. 50,00,000

Loan Amount - 80%

Loan Tenor - 15 yea rs

Rate of interest - 10%

Calculate Monthly Installment

a. 9156

b. 9651

c. 9516

d. 9165

Ans - b

Here,

PV = 5000000

LTVR = 80/100 = 0.8

n = 15 * 12 = 180

I = 10/(12*100) = 10/1200 = 0.008333

= (5000000*0.8*0.008333)/((1+0.008333)^180-1)

= Rs. 9651

So, the Monthly installment = Rs. 9651