Ask Experts Questions for FREE Help !
Ask
    Need_to_Know's Avatar
    Need_to_Know Posts: 3, Reputation: 1
    New Member
    		  
    #1

    Aug 27, 2008, 07:16 AM
    How to calculate basis points
    What is the formula to calculate 350 basis points?

    GENERAL TERMS AND CONDITIONS:
    1) The loan amount will be up to $12,175,000.00.
    2) The Use of Proceeds will be for development of subject property.
    3) The interest rate shall be libor plus 350 basis points.
    4) The loan term shall be 24 months.
    5) The collateral shall be a first mortgage on the subject property.
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
    Expert
    		  
    #2

    Aug 27, 2008, 09:28 AM
    A basis point is 1/100 of a percentage point. So 350 basis points is 3.5%.

    The LIBOR rate varies depending on the length of term, either 3-month, 6-month, or 1-year - right now it vaires from about 2.4% to 3.2%, depending on the term. So this loan would cost you somewhere between 5.9% and 6.7%.
    Need_to_Know's Avatar
    Need_to_Know Posts: 3, Reputation: 1
    New Member
    		  
    #3

    Aug 27, 2008, 09:47 AM
    Excellent Answer, Thank you so very much.
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Reporting Cash Basis versus Accrual Basis Income [ 3 Answers ]

Please help, I'm confused. Music Company had the following transactions in March: a. Sold instruments to customers for $10,000; received $6,000 in cash and the rest on account. The cost of the instruments was $7,000. b. Purchased $4,000 of new instruments inventory; paid $1,000 in cash and...

Reporting cash basis versus accrual basis income [ 1 Answers ]

Please help me. I am an online student and new to accounting. Forllowing transactions in March. Do both cash basis and accrual basis income a) Sold instrument to customers for $10,000; received $6000 in cash and the rest on account. The cost of the instrument was $7000 b)Purchased $4000 of...

How do I calculate bases points [ 3 Answers ]

How much is 150 basis points on a 200000 loan?

Reporting Cash Basis versus Accrual Basis Income [ 1 Answers ]

Mostert Music Company had the following transactions in March: a. Sold instruments to customers for $10,000; received $6,000 in cash and the rest on account. The cost of the instruments was $7,000. b. Purchased $4,000 of new instruments inventory; paid $1,000 in cash and owed the rest on...

Basis points [ 1 Answers ]

How do you calculate basis points?

View more questions Search