OPTION LOAN ANALYSIS FOR SOMEONE HAVING THE LOAN FOR FOUR YEARS;
 MAKING MINIMUM PAYMENTS

 Given:

PURCHASE PRICE 4 YEARS AGO                                        $555,556

LOAN AMOUNT                                                                      $500,000

START RATE 1%
NOTE RATE 7.55%

VALUE 4 YEARS LATER WITH 10%
DROP IN MARKET PRICE                                                       $500,000

QUESTION:

How much do you owe in relationship to the current value of your home?

CATEGORY                                         MONTHLY       BI-WEEKLY

INTEREST(4-YEARS)                       $72,250                     $64,349

ORGINAL LOAN AMOUNT                 500,000                     500,000

TOTAL OWED                                    $572,250                 $564,349

CURRENT VALUE OF HOME             $500,000                 $500,000

NEGATIVE EQUITY OF HOME          $  72,250                 $   64,349