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HP 17Bii, 17Bii+, and 19Bii Calculators - Calculating the Mortgage-Equity Analysis

Description
The following equation calculates the Ellwood mortgage coefficient, basic rate, and overall rate.
 note:
This equation assumes that the mortgage has monthly payments.
Calculating the mortgage-equity analysis
To calculate the mortgage-equity analysis, do the following:
  1. Enter the ELLWOOD equation into the Solver as follows:
    ELLWOOD: IF(S(C):(L(P:1
    ÷USPV(I%YR÷12:#YRSx12))
    xUSFV(I%YR÷12:HOLDx12)-
    SPFV(I%YR÷12:HOLDx12)+1
    )xL(Q:1÷USFV(EQY%:HOLD) )-
    12xG(P)+EQY%÷100+0xLV xCHG%-
    C:IF(S(R):(EQY%-C xLV)÷100-R:R-
    G(Q)xCHG%÷ 100-ORALL))
  2. Verify the equation:
    • For the HP 17bii and 17bii+, press EXIT, EXIT, YES (to save), then CALC
    • For the HP 19bii, press CALC
  3. Store the following variables:
    • Annual mortgage interest rate in I%YR
    • Mortgage amortization term in #YRS
    • Holding period in HOLD
    • Equity yield rate in EQY%
    • Loan to value ratio in LV
    • Change in value in CHG%
  4. Press C to calculate the mortgage coefficient.
  5. Press R to calculate the basic rate.
  6. Press ORALL to calculate the overall rate.
Example for calculating the mortgage equity analysis
What is the mortgage coefficient, basic rate, and overall rate for a property, which is expected to increase in value 25 percent over a 10-year holding period? The equity yield rate is 15 percent. A loan for 75 percent of the value is available at 12 percent interest with monthly payments for 25 years.
 note:
To display answers to 6 decimal places press DISP, FIX, 6, then INPUT.
Keys
Display
Description
12, then I%YR
I%YR=12.000000
Enter APR
25, then #YRS
#YRS=25.000000
Enter term
10, then HOLD
HOLD=10.000000
Enter holding period
15, then EQY%
EQY%=15.000000
Enter equity yield rate
75, then LV
LV=75.000000
Enter loan value
MORE
Press MORE to see more variables
25, then CHG%
CHG%=25.000000
Enter change in value
C
C=0.029643
Mortgage coefficient
R
R=0.127767
Basic rate
ORALL
ORALL=0.115454
Overall rate

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