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L <br />• <br />AC 150/5100-11 <br />APPENDIX 6 <br />Page 1 <br />APPENDIX 6. CALCULATION OF INTEREST PAYMENT DIFFERENTIAL <br />Required Information <br />1. Outstanding balance of mortgage on acquired dwelling <br />2. Outstanding balance of mortgage on replacement dwelling <br />3. Lesser of line 1 or line 2 <br />4. Number of months remaining until last payment is due for mortgage on acquired <br />dwelling. <br />5. Number of months remaining until last payment is due for mortgage on replace- <br />ment dwelling. <br />6. Lesser of line 4 or line 5 <br />7. Annual interest rate of mortgage on acquired dwelling <br />8. Annual interest rate of mortgage on replacement dwelling (or, if it is lower, the <br />prevailing annual interest rate currently charged by mortgage lending institutions <br />in the general area in which the replacement dwelling is located). <br />9. Prevailing annual interest rate paid on standard passbook savings accounts by com- <br />mercial banks. <br />10. If applicable, any debt service costs on the loan on the replacement dwelling, such <br />as points paid by the purchaser which are not reimbursable as an incidental ex- <br />pense. <br />Development of Monthly Payment Figures <br />A. Monthly payment required to amortize a loan of $ in months <br />(line 3) (line 6) <br />at an annaul interest rate of %. <br />(line 7) <br />B. Monthly payment required to amortize a loan of $ in months <br />(line 3) (line 6) <br />$ <br />$ <br />$ <br />$ <br />$ <br />at an annaul interest rate of %. <br />(line 8) <br />C. Monthly payment required to amortize a loan of $ in months $ <br />(line 3) (line 6) <br />lif at an annaul interest rate of %. <br />(line 9) <br />Calculation of Interest Payment <br />Step 1.—Subtract A from B: <br />Monthly payment based on rate for replacement dwelling (B) $ <br />Monthly payment based on rate for acquired dwelling (A) —$ <br />Result (difference) $ <br />Step 2.—Divide result (difference) of step 1 by C (carry to 6 decimal places) : <br />Result (difference) from step 1 $ <br />Monthly payment based on savings rate (C) +$ <br />Result (quotient) <br />Step 3.—Multiply outstanding balance of mortgage on dwelling by result (quotient) <br />of step 2: <br />Outstanding Balance (from Line 3) $ <br />Result (quotient) of step 2 X <br />Result (product) $ <br />97 <br />