This is how a lease option should work: After securing the go-ahead from a mortgage broker and before moving in, your potential buyer will give you a healthy, nonrefundable deposit to go toward the down payment of the house -- typically, 3 to 5 percent of the purchase price.
The amount of interest that accrues on your loan is determined by a simple daily interest calculation: Your current principal balance Ã The number of days since your last payment Ã Interest rate factor = interest rate Ã· 365.25 (number of days in a year) = Your daily interest rate.
The future value of a flat-interest loan is calculated by the formula D = L(1+(i*N)], where D = the amount of money due at the completion of the loan, L = the amount of money loaned, i = the interest rate per period, and N = the total number of periods.