The Business Master (3rd Edition)

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The Mortgage Analyzer A Mortgage Software Tool for Qualification Amortization Refinancing Mortgage Comparison Mortgage Acceleration Copyright 1992 Insight Software Solutions THE MORTGAGE ANALYZER TABLE OF CONTENTS Program Overview . . . . . . . . . . . . . . . . . . . . . . 3 General Information . . . . . . . . . . . . . . . . . . . . . 4 Disclaimer . . . . . . . . . . . . . . . . . . . . . . . 4 About Insight Software Solutions . . . . . . . . . . . . 4 Contents of Distribution Disk . . . . . . . . . . . . . 4 Shareware Defined . . . . . . . . . . . . . . . . . . . 5 Program Registration . . . . . . . . . . . . . . . . . . 5 Program Support . . . . . . . . . . . . . . . . . . . . 5 Getting Started With the Mortgage Analyzer . . . . . . . . . 6 System Requirements . . . . . . . . . . . . . . . . . . 6 Installation . . . . . . . . . . . . . . . . . . . . . . 6 Running The Mortgage Analyzer . . . . . . . . . . . . . 6 Screen Layout In The Mortgage Analyzer . . . . . . . . . . . 7 Common Screen Lines . . . . . . . . . . . . . . . . . . 7 Menu Screens . . . . . . . . . . . . . . . . . . . . . . 7 Data Input Screens . . . . . . . . . . . . . . . . . . . 7 Data View Screens . . . . . . . . . . . . . . . . . . . 7 Moving Around In The Mortgage Analyzer . . . . . . . . . . . 8 Menu System . . . . . . . . . . . . . . . . . . . . . . 8 Moving Field to Field . . . . . . . . . . . . . . . . . 8 Editing Within a Field . . . . . . . . . . . . . . . . . 9 Special Fixed Fields . . . . . . . . . . . . . . . . . . 9 Special Function Keys . . . . . . . . . . . . . . . . . 9 Loan Qualification . . . . . . . . . . . . . . . . . . . . 11 Qualification Inputs . . . . . . . . . . . . . . . . . 11 Qualification Function Keys . . . . . . . . . . . . . 12 Amortization Schedules . . . . . . . . . . . . . . . . . . 13 Amortization Inputs . . . . . . . . . . . . . . . . . 13 Amortization Function Keys . . . . . . . . . . . . . . 17 Print Schedule/Summary . . . . . . . . . . . . . . . . . . 19 Print Schedule/Summary Inputs . . . . . . . . . . . . 19 Print Schedule/Summary Function Keys . . . . . . . . . 20 Quick Calculator . . . . . . . . . . . . . . . . . . . . . 21 Four Function Calculator . . . . . . . . . . . . . . . 21 Solve For Missing Loan Value Calculator . . . . . . . 21 Points Calculator . . . . . . . . . . . . . . . . . . 21 Page 1 THE MORTGAGE ANALYZER Daily Interest Calculator . . . . . . . . . . . . . . 22 Loan Refinancing Calculator . . . . . . . . . . . . . 22 On-line User Manual . . . . . . . . . . . . . . . . . . . . 23 Configuration . . . . . . . . . . . . . . . . . . . . . . . 24 Color Attribute Selection . . . . . . . . . . . . . . 24 Printer Selection . . . . . . . . . . . . . . . . . . 25 Schedule Printing Defaults . . . . . . . . . . . . . . 26 Miscellaneous Selection . . . . . . . . . . . . . . . 26 Filing System . . . . . . . . . . . . . . . . . . . . . . . 28 Page 2 THE MORTGAGE ANALYZER Program Overview The Mortgage Analyzer The Mortgage Analyzer is a financial software program designed with ease and flexibility in mind. It comes complete with a variety of mortgage options for calculating and producing mortgage amortization schedules, loan qualification, payoff time for refinancing, and a group of mortgage related calculators. Each area contains a variety of options to allow maximum flexibility. A variety of different mortgage types are supported such as Fixed Rate, Adjustable Rate (ARM), Stepped Rate and Reset Rates. Early payoffs of mortgages are supported with options like Recurring Extra Payment, Balloon Payment, Variable Extra Payment, Double Principal Payment, Growing Equity Payment, 52 Quarter Month Payments per year, 26 Half Month Payments per Year (Bi-Weekly), 13 Monthly Payments per Year and Variable Payments. Tax Savings Analysis on the mortgage is also available. Two complete mortgages can be illustrated side by side with one or all items of information varied. The Mortgage Analyzer accounts for all expenses associated with Mortgages such as Points, Down Payment, Daily Interest and Other Closing Costs. Complete schedules and/or summaries are produced. Calculators provided are: a Four Function Calculator, a Solve For Missing Loan Value Calculator, a Points Calculator, a Daily Interest Calculator, and a Refinance Payback Calculator. Schedules and reports can be viewed on the screen or sent to a printer. The Mortgage Analyzer is a menu driven program that also contains an on-line manual and individual help for each input to allow the user to easily navigate and understand the program. Client names can be entered and included in the schedules; all information can be saved and retrieved for multiple clients. The Mortgage Analyzer provides several miscellaneous configuration options for setting the program up to individual needs. Page 3 THE MORTGAGE ANALYZER General Information Disclaimer Insight Software Solutions makes no warranties or representations of any kind, expressed or implied, including any implied warranties of merchantability and fitness for any particular purpose. Insight Software Solutions shall not be liable for any errors contained herein or for any loss of profit or for incidental or consequential damages or for any other damages. About Insight Software Solutions Insight Software Solutions is located in Bountiful, Utah. Please send any inquiries, questions, suggestions or comments to the following address: INSIGHT SOFTWARE SOLUTIONS P.O. BOX 354 BOUNTIFUL, UT 84011-0354 Phone/Fax: 801-295-1890 Contents of Distribution Disk The Mortgage Analyzer diskette contains several files which are needed for optimal performance. Their names and functions are listed below. MORT.EXE This is the main executable program. MORT.CFG This contains program configuration information such as screen color and printer selections. This file is automatically created if not found. MORT.PTR This contains printer definitions for a variety of printers. MORT.DOC This is the User Manual for The Mortgage Analyzer. MORT.BAT This is a start up batch file for hard disks. INSTALL.EXE This copies the program to a hard disk. MORT.DAT This contains all saved cases. Page 4 THE MORTGAGE ANALYZER Shareware Defined Shareware is a marketing concept in which copyrighted software products are distributed by allowing and encouraging duplication of the program for evaluation by interested parties. As a recipient of a shareware program, you are granted the right to use the program for a short period to determine if it meets your needs. The program developer receives payment from the users after they have determined that the product meets their needs. The motivation for making payment for a shareware program is honest payment for a valuable tool, desire for support, updates, enhancements and documentation, and to help encourage shareware authors to produce additional quality programs. Program Registration The Mortgage Analyzer can be registered with Insight Software Solutions by sending a check or money order in the amount of $25.00 U.S. funds to the address listed above. Upon receipt, Insight Software solutions will send you the latest version of The Mortgage Analyzer along with a printed manual. Once registered, you will receive notification of major updates and new products. Registration includes a 90 day support policy where free updates will be provided for major problems. If a problem cannot be resolved, then a refund of money will be made. Program Support Insight Software Solutions offers support through the mail, phone, fax and BBS. Please refer to address and phone number above. Our official support BBS is the Rocky Mountain Software BBS (RMS). RMS can be reached 24 hours a day at (801) 963-8721 where a conference dedicated to us can be found. Our latest software products and versions, bulletins, news and message system are located on RMS. RMS accepts modem baud rates of 1200 to 38400. Insight Software Solutions is a member of the Association of Shareware Professionals (ASP). ASP wants to make sure that the shareware principal works for you. If you are unable to resolve a shareware related problem with an ASP member by contacting the member directly, ASP may be able to help. The ASP Ombudsman can help you resolve a dispute or problem with an ASP member, but does not provide technical support for members' products. Please write to the ASP Ombudsman at 545 Grover Road, Muskegon, MI 49442 or send a CompuServe message via CompuServe Mail to ASP Ombudsman 70007.3536. Page 5 THE MORTGAGE ANALYZER Getting Started With the Mortgage Analyzer System Requirements The Mortgage Analyzer is almost hardware independent. It will run on most PC systems. The minimum requirements are as follows: IBM type PC, XT, AT or PS/2 (or compatible) 512K Ram Dos 2.0 or higher any monochrome, color, or composite monitor virtually any printer that supports condensed printing Installation The Mortgage Analyzer may be run from either a floppy or hard disk. There are no special installation procedures to set up the program. To load the program onto a hard disk, simply copy the contents of the floppy diskette onto the hard disk. We recommend that it be placed into its own subdirectory. An installation program called INSTALL.EXE is provided to assist you in the installation of the program on a hard drive. From the A> prompt, simply type "INSTALL". This will prompt you through the installation process. Running The Mortgage Analyzer To run The Mortgage Analyzer, simply type "MORT". This can be done from the floppy disk or from a hard drive if you used the provided installation procedure. Page 6 THE MORTGAGE ANALYZER Screen Layout In The Mortgage Analyzer Common Screen Lines There are several common screen lines found in The Mortgage Analyzer. This includes the first, second, twenty-third, twenty- fourth, and twenty-fifth lines. The first line contains the current date and time as specified by DOS; it also contains the copyright notice of INSIGHT SOFTWARE SOLUTIONS. The second line is part of the box surrounding the user work area; it generally contains a centered title describing the function of the current screen. The twenty-third line is the status line--it shows the status of the Help, Caps, Scroll Lock, Num Lock, and Insert keys. The twenty-fourth line is the prompt line. It indicates what you are supposed to do for a given input field. The twenty-fifth line is the Function Keys Status line. It shows what Function Keys (F1, F2, ...) are available for use and what their particular functions are. Menu Screens Menu Screens appear as a list of numbered items. A movable highlight bar indicates the current menu selection. Data Input Screens Data Input Screens contain fields or areas which can be changed. These fields are generally preceded by a label indicating what type of value is needed for the field. Data View Screens Data View Screens contain scrollable text for your viewing. Where applicable, the text can be scrolled up and down and left and right. Indications of the current location in the text are given on the left side of the status line. Page 7 THE MORTGAGE ANALYZER Moving Around In The Mortgage Analyzer Menu System Menus appear as a list of numbered options. To select the option desired, press the associated number. An alternate method of selection is to use the arrow keys along with the <Enter> key. One option is always highlighted and indicates the current option. To change the current option, press the UP and DOWN arrow keys to move the highlight bar. Once the desired option is highlighted, press the <Enter> key to make the selection. Moving Field to Field Moving from one field to another field can be accomplished by many different keystrokes. Listed below is a summary of the keystrokes available and the functions they perform. ENTER KEY: Moves the cursor to the next logical field. RIGHT ARROW KEY: If the cursor is on the last editing character of the field, this key moves the cursor to the right of the current field. LEFT ARROW KEY: If the cursor is on the first character of the field, this key moves the cursor to the field to the left of the current field. DOWN ARROW KEY: Moves the cursor to the field below the current field. UP ARROW KEY: Moves the cursor to the field above the current field. PAGE DOWN KEY: Moves the cursor to the last field on the screen. PAGE UP KEY: Moves the cursor to the first field on the screen. TAB KEY: Moves the cursor to the next logical field. TAB LEFT KEY: Moves the cursor to the previous logical field. <CTRL> RIGHT ARROW KEY: Moves the cursor to the field to the right of the current field. <CTRL> LEFT ARROW KEY: Moves the cursor to the field to the left of the current field. Page 8 THE MORTGAGE ANALYZER Editing Within a Field Editing within a field can be accomplished with many different keystrokes. Listed below is a summary of the keystrokes available and the functions they perform. RIGHT ARROW KEY: Moves the cursor one character to the right. LEFT ARROW KEY: Moves the cursor one character to the left. HOME KEY: Moves the cursor to the beginning of the field. END KEY: Moves the cursor to the last character in the field. BACKSPACE KEY: Moves the cursor to the left one character and erases that character and shifts all trailing characters to the left one space. INSERT KEY: Toggles between insert mode and typeover mode. DELETE KEY: Erases the character under the cursor and shifts all trailing characters to the left one space. ALPHA/NUMERIC KEY: Outputs the character where the cursor is and moves the cursor over to the right, one space. If insert mode is on, then all trailing characters are moved to the right, one space. Special Fixed Fields There are certain fields which have fixed values. When the cursor is moved to these fields, a window of choices appears. Each choice has either an associated number or letter next to it. Pressing the associated number or letter automatically makes the desired selection and moves the choice into the input field. Special Function Keys There are a number of special function keys which perform a variety of tasks. These keys are as follows. <ESC> KEY: This key always takes you back one level from where ever you are. For example: if you enter a screen from a menu, then the <Esc> key will take you back to that menu. <F1> KEY: This key is the help key. It toggles off and on whether help messages should be shown with each input. Page 9 THE MORTGAGE ANALYZER <F2>..<F10> KEYS: These other function keys may or may not be active and have different functions in different parts of the program. Brief explanations of what these keys do are displayed on the screen in the Function Key line. Detailed information is given under the documentation of each particular screen as to which Function Keys are active and what their function is. Page 10 THE MORTGAGE ANALYZER Loan Qualification Qualification Inputs There are 17 different Qualification input fields. They are as follows: TITLE: This field is a title line printed on the top of the report. This uses a line on the report only if something is entered; therefore, you can fit more of the report on a page if the title is left blank. PRODUCED FOR: This field is for personalizing the report. This uses a line on the report only if something is entered; therefore, you can fit more of the report on a page if this is left blank. Please note that if you are saving and restoring cases (files), that the filer system distinguishes unique cases by this name; therefore, you should specify a name if you wish to save different cases. MORTGAGE TYPE: This is the type of loan you want to qualify for. This can be a Conventional Loan with a fixed interest rate, a Conventional ARM Loan whith an adjustible interest rate, an FHA Loan (Federal Housing Administration) or a VA Loan (Veterans Administration). It is more difficult to qualify for a conventional loan. Lenders usually prefer ARMs making it easier to qualify for them. FHA and VA loans have less stringent qualification ratios. PRODUCED BY: This is for personalizing the report. This uses a line on the report only if something is entered; therefore, you can fit more of the report on a page if this is left blank. PURCHASE PRICE: The price of the home you want to buy. If you are refinancing, then enter the approximate value. DESIRED MORTGAGE: The amount you want to finance--it is the purchase price minus any down payment. YEARS IN MORTGAGE: The number of years in the mortgage (typically 15 or 30 years). INTEREST RATE: The interest rate on the mortgage. If you plan on using an ARM (Adjustable Rate Mortgage) or a Stepped Rate Mortgage or Buydowns, then enter the initial interest rate. PROPERTY TAXES: Your estimated annual real estate taxes. Be sure to enter the annual amount--the computer will automatically figure out the monthly amount. Page 11 THE MORTGAGE ANALYZER HOME INSURANCE: Your estimated annual homeowners insurance amount. Be sure to enter the annual amount--the computer will automatically figure out the monthly amount. MORTGAGE INSURANCE: This is your estimated Mortgage Insurance. You may press the F2 Estimate Mortgage Ins Key to have it estimated for you. Typically, the Mortgage Insurance is based on your Loan-to-Value Ratio. The Loan-to-Value Ratio is the amount of the loan divided by the value of the house. For example: Mortgage = 90,000 and Purchase Price = 100,000 then Loan-to-Value = 90% or 90,000 / 100,000. Typically, if the Loan-to-Value ratio is 80% or less, then no Mortgage Insurance is needed. At 90%, the Mortgage Insurance is usually around 0.30% of the loan amount. Above 90%, it is usually around 0.44%. ASSOCIATION DUES: This is any condominium or homeowner association dues you may have. This amount only applies to condominiums or homes which have shared common areas. GROSS MONTHLY INCOME: This is the total of all your income. This amount should include salaries, bonuses, commissions, interest, dividends, etc. This is your monthly income. If you know your gross annual income, then divide it by twelve. Last year's income tax return may be helpful. CAR PAYMENTS: This is your monthly car payment if you have one. If you have less than ten car payments left, then this is usually not required. ALIMONY/CHILD SUPPORT: This is any alimony or child support payments you make each month. CREDIT CARD PAYMENTS: This amount is the total of all the minimum payments for your credit card accounts. OTHER LOAN PAYMENTS: This is the total monthly payment of all other loans you may have. This may include other mortgages, student loans, personal loans, etc. Qualification Function Keys F4 KEY (VIEW/PRINT): This function produces a Qualification Analysis Report and displays it in a window on the screen. Once in the window, the report can be scrolled within the window vertically and horizontally by use of the arrow, PgUp, PgDn, Home and End keys; it can also be sent to the printer by use of the F2 Key (Print). The viewed report is identical to what the printed report will look like with the exception that the printed report may use condensed and bold print. F9 KEY (QUICK CALC): This simply pops up the quick calculator. See the documentation about the quick calculator for usage. Page 12 THE MORTGAGE ANALYZER Amortization Schedules Amortization Inputs There are up to 16 different Amortization Inputs depending on the Amortization Illustration chosen. They are as follows: TITLE: See "title" under Qualification Inputs. PRODUCED FOR: See "produced for" name under Qualification Inputs. PRODUCED BY: See "produced by" under Qualification Inputs. SPECIAL OPTIONS: This feature consists of eleven choices which are as follows: None, Recurring Extra Payment, Variable Extra Payment, Double Principal Payment, Variable Payment, 13 Monthly Payments Per Year, 26 Half Month Payments Per Year, 52 Quarter Month Payments Per Year, Growing Equity Payments, Balloon Payment and Mortgage Comparison. None is for producing a basic amortization schedule. Recurring Extra Payment option adds the ability to specify a constant extra amount payable towards the principal each month. Variable Extra Payment option adds the ability to specify a different amount each month of extra money to be paid towards principal. Double Principal Payment option displays what doubling the principal payment each month does to the loan (it cuts the loan period almost in half). Variable Payment option adds the flexibility to specify whatever payments you would like for every month of the mortgage. 13 Monthly Payments Per Year option allows you to specify a month where two normal payments will be made (typically reduces a 30 year mortgage to 21 years). 26 Half Month Payments Per Year option allows you to specify two months where three half payments will be made (typically reduces a 30 year mortgage to 21 years). 52 Quarter Payments Per Year option allows you to specify four months where five quarter payments will be made (typically reduces a 30 year mortgage to 21 years) Growing Equity Payments Option allows you to specify a percentage that the mortgage payment is to go up each year. The extra money goes towards the principal and accelerates the loan. Balloon Payment option adds the ability to show the loan for a short period of time and then what one final payment would be to pay off the loan. Mortgage Comparison Option allows two complete and separate mortgages to be compared side by side. Typically, this would be Page 13 THE MORTGAGE ANALYZER used to compare two similar loans to see how a slight change impacts the loan. COMPARISON: A comparison will produce a pair of schedules side by side. The first schedule will be the standard mortgage schedule. The second schedule will illustrate the results of the special option. For example: if using the Recurring Extra Payment option, the second schedule would illustrate the effect of paying a constant extra payment towards the loan. TAX ANALYSIS: This allows you to have a tax savings analysis done on your mortgage. This is based on using Itemized Deductions in the current U.S. tax code. Additional columns appear on the schedule indicating the potential tax savings. If a special option comparison is selected, then the tax savings will be based on the special option side of the comparison. Due to column limitations, the tax analysis is unavailable for the special option of Mortgage Comparison. TAX BRACKET: This field only appears if Tax Analysis has been selected. This is the tax bracket of the person who is obtaining the mortgage. This will illustrate the portion of the payments that can be returned or saved through declaring the mortgage as a deduction on the individual's taxes. PURCHASE PRICE: The price of the home you want to buy. DOWN PAYMENT: The down payment you plan to make on the loan. This does not include any points, closing costs, etc. MONTHS IN MORTGAGE: The number of months that payments will be made. This is typically 360 (30 years) or 180 (15 years). INTEREST TYPE: This provides for four common mortgage interest rate methods. They are FIXED, STEPPED, ADJUSTABLE and RESET. A fixed rate uses the same interest rate throughout the entire length of the mortgage. A stepped rate mortgage typically starts the interest rate out below the prevailing rates and over a period of a few years, rises each year until it peaks and levels off. An adjustable rate mortgage (ARM) allows the interest rate to be adjusted each and every month. The rate typically goes up or down, depending on the prevailing mortgage rates during a given month. A reset rate allows two different interest rates on the mortgage; the first is a lower rate and lasts for usually 5 or 7 years, then the second rate takes over and remains until the completion of the loan. INTEREST RATE: This is the interest of the loan. For STEPPED, Page 14 THE MORTGAGE ANALYZER ADJUSTABLE and RESET types of rates, you may press the F2 INTEREST key to enter additional rates. CLOSING DATE: This is the date that you close on the house. Closing is the process of "signing the papers". Daily interest is calculated and applied to the closing costs based on the difference in days between the closing date and the origination date of the loan. The closing date is the date that the papers are signed and the origination date is the date that the loan actually starts. FIRST PAYMENT DATE: This is the date that the first payment is due. It is the date upon which the loan schedule is created. All payments are based upon this date--it should not be less than a month after the closing date or more than 2 months after the closing date. POINTS: The points should include those for the Loan Origination Fee and any Discount Points. 1 POINT is equal to 1 percent of your loan. For example: 2 points on a $100,000 loan would be $2,000. Most lenders charge a Loan Origination Fee in points. To receive a lower interest rate on your mortgage, you can pay points to the lender. It is the concept of buying down your interest rate. You pay more money up front so you pay less all the way along. If you do not plan to stay in your house for a long period of time, then it is generally not wise to buy down your interest rate very far. PROPERTY TAX: This is your annual real estate tax assessment. Assessments are usually between 0.75% to 2.0% of a home's value. HOMEOWNERS INS: This is your yearly homeowners insurance premium. CLOSING COSTS: This is the amount of money to be paid to close on your house. This amount should include such items as: Appraisal, Credit Report, Inspection Fee, Documentation Fee, Attorney's Fees, Title Insurance, Transfer Tax, Recording Tax, Survey and Termite Inspection. DO NOT include the following: Loan Origination Fee, Discount Points, Odd Days' Interest, Mortgage Insurance, Homeowner's Insurance and Real Estate Taxes. These are all accounted for elsewhere. MRTGE DEFAULT INS: This is the Mortgage Default Insurance. It insures the lender against default and foreclosure. This is typically charged on FHA loans as a front end premium. Most conventional loans require this insurance if the loan-to-value ratio is greater than 80%. Annual renewal insurance is a premium Page 15 THE MORTGAGE ANALYZER which is added each year based on a percentage of the outstanding loan; this is typically between 0.4% and 0.8%. Many times this premium will be dropped once the loan value ratio drops to around 70 to 80 percent. PREMIUM/PERCENT: This field appears if a Mortgage Default Insurance is selected. If the "Front End Premium" is chosen, then this is the premium which is paid up front to cover the Mortgage Default Insurance. If the "Annual Renewal Insurance" is chosen, then this is a yearly premium based on a percentage of the remaining balance of the loan; this is usually between 0.4% and 0.8%. PERCENT STOP: This field appears only if the "Annual Renewal Insurance" has been selected as the type of Mortgage Default Insurance--it is the loan value ratio when the mortgage default insurance is to drop off. This is usually around 70% to 80%. POINTS TAX DEDUCT: This determines when and if any tax deduction is allowed on the points paid. The points are typically fully deductible the first year on a first home. The points are typically deductible over the life of the loan on a second home. It is unusual for points not to be deductible. EXTRA PAYMENT: This field appears only with the special option of Recurring Extra Payment or Variable Extra Payment. This is an additional amount of money which is to be applied to the principal of the loan each month--it accelerates the mortgage and pays it off early. For Variable Extra Payments, the F2 PAYMENTS Key is available to add different payments. VARIABLE AMOUNT: This field appears only with the special option of Variable Payment. The monthly payment is normally determined by amortizing the original principal at the given interest rate for a given duration. The Variable Payment field, however, lets you override the monthly payment amount. You can specify whatever amount you want to pay towards the loan. This option allows total flexibility in the amounts you wish to pay towards your loan. A notation to the right of the periodic payment will indicate either flat payments or variable payments. "Flat Payments" means that the monthly payment shown is for every single month during the term of the mortgage. "Variable Payments" means that it has been specified at some point to use a different monthly payment. Variable payments are made possible through the F2 PAYMENTS function key. MNTH UNTIL BALLOON: This field appears only with the special option of Balloon Payment. It allows the number of months to be Page 16 THE MORTGAGE ANALYZER specified before the balloon payment is to be made. EXTRA PAYMENT MNTH: This field appears only with the special option of 13 Payments per year. When this option is selected, there are 13 payments made a year. One month of the year will have an extra payment made. This field is to specify the month that will have the extra payment. 3 PAYMENT MONTH: This field appears only with the special option of 26 Bi-Weekly Payments. When this option is selected, there are 26 half-payments made a year. Two months of the year will have 3 payments made and the rest will have 2 payments made. This field is to specify one of the months that will have an extra payment (3 payments). The other month to have 3 payments is computed automatically at 6 months from the month chosen here. 5 PAYMENT MONTH: This field appears only with the special option of 52 Weekly Payments. When this option is selected, there are 52 quarter-month payments made in a year. Four months of the year will have 5 payments made and the rest will have 4 payments made. This field is to specify one of the months that will have an extra payment (5 payments). The other months to have 5 payments are computed automatically at 3 month intervals from the month chosen here. PAYMT GROWTH RATE: This field appears only with the special option of Growing Equity Payments. The Payment Growth Rate is the percentage at which to increase the monthly payment each year. By increasing the payments each year, your payment can go up with increases in salary, etc; the extra money goes towards principal and pays off the loan early. A 4% yearly increase will pay a typical 30 year loan off in 15 years. Amortization Function Keys F2 KEY (PAYMENTS): This function key is available only if the special option of Variable Extra Payment or Variable Payments has been selected and the cursor is on the Extra Payment or Variable Payment field. This pops up another screen which allows up to 100 payment inputs. Each payment is numbered. New function keys appear, indicating how to change payments above 100. There will be enough inputs and function keys to cover the duration specified for the mortgage. By this method, you may enter in different payments for the entire span of the mortgage. The new F2 key (DUP) will duplicate the previous value and advance the cursor--this allows easy duplication of payments without having to rekey them. Page 17 THE MORTGAGE ANALYZER F2 KEY (INTEREST): This function key is available only if the Interest Type selected is Stepped, Adjustable or Reset and the cursor is in the Interest Rate field. For the Stepped Rate, this pops up another screen which allows you to enter an interest rate for each year in the mortgage. For the Adjustable Rate, this pops up another screen which allows up to 120 interest rate inputs. Each interest rate is numbered. By this method, you may enter different interest rates for each month of the mortgage. The new F2 key (DUP) will duplicate the previous value and advance the cursor--this allows easy duplication of interest rates without having to rekey them. For the Reset Rate, this pops up another screen which allows you to enter two interest rates and the year when the second rate takes over. F4 KEY (VIEW/PRINT): This brings up the Print Schedule/Summary Menu. This menu allows for several options on how your schedule is to appear. Please refer to the section on this menu for more information. F5 KEY (SUMMARY): This function calculates the mortgage and produces a summary page of all mortgage information selected. F9 KEY (QUICK CALC): This simply pops up the quick calculator. See the documentation about the quick calculator for usage. Page 18 THE MORTGAGE ANALYZER Print Schedule/Summary Print Schedule/Summary Inputs The Print Schedule/Summary screen allows for a variety of options which affect the way the schedule and summary are to be printed. The fields are listed below with their respective functions. PRINT DESTINATION: This function allows you to specify where the schedule is to be sent--it can be sent to the screen or the printer. The schedule appears on the screen as it will appear when it is printed. When viewing the schedule or summary on the screen, function keys are available to send the schedule or summary directly to the printer without having to come back and change the print destination to the printer. SCHEDULE DETAIL: This specifies the schedule detail--it allows you to show each and every month or to view yearly results. YEARLY BASIS: This function allows you to select how the cumulative totals of the schedule are to be displayed. They can be displayed on either a calendar or fiscal year basis. A fiscal year basis displays the totals at exact yearly intervals. For example, a loan paid monthly which starts in March would show totals each March. If a calendar basis is chosen, totals would be shown at the end of each calendar year. For example, a loan which starts in April would show totals each December or end of the year. CUMULATIVE VALUES: This allows you to show each line of values as cumulative totals from all previous years or months in the schedule. CUMULATIVE TOTALS: This field only applies if you are using a monthly schedule and you are not using cumulative values. Selecting "Yes" here will show the totals after each year as a cumulative total. Selecting "No" will show the totals for each individual year. DOLLAR VALUES: This function specifies the use of dollar values in the schedule. If "no" is selected, cents appear in the figures. You would normally use dollar values if you prefer working with whole numbers or if you are working with a very large mortgage where the numbers start to merge when showing the cents. DATE FORMAT: This specifies the format in which the dates will appear in a report. For example, a date of October 23, 1992 would Page 19 THE MORTGAGE ANALYZER appear as follows: MM/DD/YY = 10/23/92 DD/MM/YYYY = 23/10/1992 MM-DD-YY = 10-23-92 DD-MM-YYYY = 23-10-1992 MM.DD.YY = 10.23.92 DD.MM.YYYY = 23.10.1992 MM/DD/YYYY = 10/23/1992 YY-MM-DD = 92-10-23 MM-DD-YYYY = 10-23-1992 YY.MM.DD = 92.10.23 MM.DD.YYYY = 10.23.1992 YYYY-MM-DD = 1992-10-23 DD/MM/YY = 23/10/92 YYYY.MM.DD = 1992.10.23 DD-MM-YY = 23-10-92 MMM YYYY = Oct 1992 DD.MM.YY = 23.10.92 DD MMM YY = 23 Oct 92 PAGES TO PRINT: This function allows you to specify what part of the report you would like to view or print. You may choose either the schedule, summary or both. The summary can be viewed directly form the main Amortization Input screen by use of the F5 KEY. Print Schedule/Summary Function Keys F4 KEY (START PRINT): This function starts the actual printing of the schedule or summary. Based on the print destination, it either sends the schedule to the screen or the printer. Page 20 THE MORTGAGE ANALYZER Quick Calculator The Quick Calculator can be selected as option three from the main menu or by the F9 (QCALC) Key from one of the input screens. This option is used to calculate a variety of mortgage calculations and for simple math functions. The Quick Calculator contains its own menu. You can select a loan value to solve for, a four function calculator or a specific mortgage related calculator. Four Function Calculator The four function calculator simply allows you to type in numbers and add, subtract, multiply, and divide them. The result is displayed and can then be used as one of the next numbers in a calculation. Solve For Missing Loan Value Calculator This feature consists of four "solve for values". By selecting one of these values to solve for, inputs appear which you must enter to solve for the selected value. These values and inputs are listed below. PRINCIPAL: Allows you to solve for the principal amount of a loan when given the monthly payment, duration and interest rate. PAYMENT: Allows you to solve for the monthly payment of a loan when given the principal amount, duration and interest rate. DURATION: Allows you to solve for the duration of a loan when given the principal amount, monthly payment and interest rate. INTEREST RATE: Allows you to solve for the interest rate of a loan when given the principal amount, monthly payment and duration. Points Calculator The points calculator simply calculates the amount of money that the points will cost based on the loan amount. The fields are listed below. Pressing the F2 KEY will calculate the value of the points. PRINCIPAL: The loan amount. POINTS: The number of points that are to be applied to the loan amount. Page 21 THE MORTGAGE ANALYZER Daily Interest Calculator The daily interest calculator simply calculates the amount of daily interest to be paid on a given loan. The fields are listed below. Pressing the F2 KEY will calculate the amount of daily interest. LOAN AMOUNT: The amount of the loan. INTEREST RATE: The interest rate of the loan. DAYS: The number of days for which to calculate interest on the loan. Loan Refinancing Calculator The loan refinancing calculator estimates the amount of money to be saved in the first year of the refinanced mortgage; it also determines the number of months that it will take before the money saved pays back the cost to refinance the mortgage. The fields are listed below. Pressing the F2 KEY will calculate the described values. INITIAL MORTGAGE: The loan amount of your current mortgage. TERM OF MORTGAGE: The original number of years scheduled to pay off your current mortgage. AGE OF MORTGAGE: The number of months that you have already paid on your current mortgage. OLD INTEREST RATE: The interest rate on your current mortgage. REFINANCE COSTS: The cost to refinance your mortgage. NEW INTEREST RATE: The new interest rate that you will obtain on your refinanced mortgage. Page 22 THE MORTGAGE ANALYZER On-line User Manual The Mortgage Analyzer provides the capability to review this manual on-line. The manual review is accessed from option number six from the main menu. Once option six is selected, the user manual is loaded into memory and displayed on the screen; you can scroll through at will by use of the arrow keys and PgUp and PgDn keys. The manual can be printed by your printer by pressing the F2 key. The file "MORT.DOC" contains the user manual--it is in standard ASCII format and can be read in by virtually any editor or word processor. It can be printed by simply using the Dos Print command. (PRINT MORT.DOC) Page 23 THE MORTGAGE ANALYZER Configuration The configuration section allows you to configure the program to work with the printer of your choice, to work with the colors of your choice, to select default schedule printing options and to set miscellaneous options. Option number six from the main menu brings up this menu. The menu contains four options. The first is to allow you to change the colors used in the program. The second is to select a printer and set up specific printer options. The third is for selecting Schedule Printing Defaults options. The fourth is for setting up miscellaneous functions and data in the program. Color Attribute Selection Selecting the color attribute option brings up a screen with a list of all the different areas where different colors are used and a displayed list of color to choose from. These are listed below with a brief description of what areas are effected by the specified color attribute names. Listed below the attribute names is a list of active Function Keys which can help in setting up your colors. SCREEN ATTRIBUTE: The color that the screen uses everywhere except for the following special areas. This is the most common color. FIELD ATTRIBUTE: The color that input fields appear in while they are not being edited. This distinguishes them from normal text on the screen. EDIT ATTRIBUTE: The color of an input field while it is being edited. This helps identify where you are at on the screen. FKEY ATTRIBUTE: The color that the FKey line appears in at the bottom of the screen. ERROR ATTRIBUTE: The color that error messages pop up in. MENU NORMAL ATTRIBUTE: The color that pop up scrollable selection windows appear in. MENU HIGHLIGHT ATTRIBUTE: The color that the highlighted selection of menus and pop up scrollable selections appear in. STATUS ATTRIBUTE: The color that the screen title appears in. Also the color of the Caps Lock, Num Lock, Insert, Scroll, and Help status. Page 24 THE MORTGAGE ANALYZER F2 KEY (SHOW COLOR): Displays the current color specified in the field where the cursor is located. The color is displayed in a window in the bottom right corner. F3 KEY (OTHER COLORS): There are 256 colors available, but only 128 of them are displayed on the screen at one time. The F3 Key toggles between displaying the different sets of 128 colors. F4 KEY (DEFAULT MONO): Automatically sets all the fields to the default colors selected by Insight Software Solutions for a monochrome monitor. F5 KEY (DEFAULT COLOR): Automatically sets all the fields to the default colors selected by Insight Software Solutions for a color monitor. Printer Selection The printer selection brings up a menu which has several options. The options are to Select A Printer, Delete A Printer, Add A Printer, Modify A Printer, and to Alter Line Spacing and Margins. Below the menu items is a list of the current printer specifications. Selecting a printer brings up a list of printers. Simply use the arrow keys to highlight your printer type and press the <Enter> key. If your printer is not listed, you may try several of the printers listed to see if your printer is compatible with one of those listed. If it is not, then you may enter your own printer definition for your exact printer. Deleting a printer definition should not be used very often. Simply use the arrow keys to select the printer definition to be deleted and press the <Enter> Key. You will be prompted to verify that you really want to delete the printer definition. Adding a printer definition can be difficult if you are not familiar with printer control sequences. Selecting this option brings up a printer input screen; it asks for a printer name along with many different printer control sequences. The printer control sequences need to be entered in hexadecimal notation. If you are unable of performing this task, Insight Software Solutions is willing to set up your printer definition for free if you are a registered user and you send Insight Software Solutions a copy of the control codes out of your printer manual. Modifying a printer definition brings up the same screen as Adding A Printer definition, you may then change any of the Page 25 THE MORTGAGE ANALYZER fields desired. If the printer name is changed, the changed definition will not be overwritten but will appear as a new printer definition--this allows you to create a similar printer definition without rekeying all the control sequences back in. The altering line spacing and margins allows you to specify six different items. These items are: the top margin, left margin, line spacing, page pausing, IBM graphics characters and Printer Port. The illustration is automatically centered on the page left to right starting at line one. If you desire a top margin it can be specified. (Note: Laser printers should not normally specify a top margin.) If a larger left margin is desired (for punched holes, etc) then a larger left margin can be specified. The line spacing can be sent to either 6 lines per inch or 8 lines per page if more information per page is desired. "Pause After Each Page" allows you to insert new pieces of paper if your printer does not have continuous form paper. Selecting the IBM graphics characters, tells the program to build the illustration using graphic characters for dashes and double dashes. Using the graphic characters produces a solid line. These characters are used under headings, etc. Some printers do not support these characters. If you select this option and you get strange results on your printout, then you will need to turn this option off. You may select to have your printed output go to either LPT1, LPT2 or LPT3; this is helpful if you have more than one printer connected to your computer. Schedule Printing Defaults The Schedule Printing Defaults section brings up a screen identical to the Print Schedule/Summary screen. In this section, you choose the values you want to use most frequently in the Print Schedule/Summary screen. The values chosen here in the Schedule Printing Defaults will be those which appear automatically in the Print Schedule/Summary screen when the program is initially run. Please refer to the section on Print Schedule/Summary for more specific detail on the fields. Miscellaneous Selection The Miscellaneous Configuration section allows you to adjust the program and the reports and schedules to your preference. There are seven inputs--the first three are for permanent illustration header lines. Typically these lines would be set to your company name and address, but can be set to anything. These lines appear at the top of every illustration before anything else and do not need to be retyped each time the program is run--they are saved and retrieved each time it is used. By selecting the "Turn Sound Page 26 THE MORTGAGE ANALYZER Off" selection, most sound effects will not occur. If you do not wish to see the startup logo each time you run The Mortgage Analyzer, then you may select "Bypass Logo at Start". By selecting "Erase Numeric Fields", the program will clear a numeric field of its current value when you type a digit as the first thing you do when editing the field. "Erase Alpha Fields" is identical to the "Erase Numeric Field", but applies to fields that allow normal alphabetic text. Page 27 THE MORTGAGE ANALYZER Filing System The Mortgage Analyzer provides the capability to save and retrieve all information that has been entered in the Qualification and Mortgage Schedule Input Screens. To invoke this option, select option 4 from the main menu--this will bring up another menu. The menu allows you to load saved cases or save out the existing case you are working on. Cases are distinguished by the name specified as the client. When saving a case, if a case by that name already exists, you will be prompted to either not save or to overwrite the existing case. Retrieving a case is simple. A list of all saved cases will appear. You can scroll through the cases and by pressing the <Enter> Key, load in the highlighted case. Saved cases can be marked for deletion by pressing the F2 (MARK A CASE) Key. This simply puts a little box to the left of the case name. You can mark as many as desired for deletion. No cases are deleted until the F3 (DELETE MARKED CASES) key is pressed. Pressing the F3 (DELETE MARKED CASES) Key still gives you one more chance to back out before deletion begins. Page 28