Question

You plan to purchase a $310,000 house using a 15-year mortgage obtained from your bank. The mortgage rate offered to you is 5.10 percent. You will make a down payment of 20 percent of the purchase price.

a. Calculate your monthly payments on this mortgage.
b. Construct the amortization schedule for the mortgage. How much total interest is paid on this mortgage?
  

Construct the amortization schedule for the mortgage? (Do not round intermediate calculations. Round your answers to 2 decimal places. (e.g., 32.16))

• How much total interest is paid on this mortgage? (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

  	Total interest is paid on this mortgage

Answer 1

Loan amount = Present value of future monthly payments = monthly payment * [1-(1+i)^-n]/i

i = interest rate per period

n = number of periods

a)

Loan amount = 310000 * 0.2 = 248000

monthly payment * [1-(1+0.051/12)^-180]/(0.051/12) = 248000

=>

monthly payment = 1974.11

b)

	Beginning Balance	Interest	Principal	Ending Balance
1	$248,000.00	$1,054.00	$920.11	$247,079.89
2	$247,079.89	$1,050.09	$924.02	$246,155.87
3	$246,155.87	$1,046.16	$927.95	$245,227.92
4	$245,227.92	$1,042.22	$931.89	$244,296.03
5	$244,296.03	$1,038.26	$935.85	$243,360.17
6	$243,360.17	$1,034.28	$939.83	$242,420.34
7	$242,420.34	$1,030.29	$943.82	$241,476.52
8	$241,476.52	$1,026.28	$947.83	$240,528.68
9	$240,528.68	$1,022.25	$951.86	$239,576.82
10	$239,576.82	$1,018.20	$955.91	$238,620.91
11	$238,620.91	$1,014.14	$959.97	$237,660.93
12	$237,660.93	$1,010.06	$964.05	$236,696.88
year 1 end
13	$236,696.88	$1,005.96	$968.15	$235,728.73
14	$235,728.73	$1,001.85	$972.26	$234,756.47
15	$234,756.47	$997.71	$976.40	$233,780.07
16	$233,780.07	$993.57	$980.54	$232,799.53
17	$232,799.53	$989.40	$984.71	$231,814.81
18	$231,814.81	$985.21	$988.90	$230,825.91
19	$230,825.91	$981.01	$993.10	$229,832.81
20	$229,832.81	$976.79	$997.32	$228,835.49
21	$228,835.49	$972.55	$1,001.56	$227,833.93
22	$227,833.93	$968.29	$1,005.82	$226,828.11
23	$226,828.11	$964.02	$1,010.09	$225,818.02
24	$225,818.02	$959.73	$1,014.38	$224,803.64
year 2 end
25	$224,803.64	$955.42	$1,018.69	$223,784.94
26	$223,784.94	$951.09	$1,023.02	$222,761.92
27	$222,761.92	$946.74	$1,027.37	$221,734.54
28	$221,734.54	$942.37	$1,031.74	$220,702.80
29	$220,702.80	$937.99	$1,036.12	$219,666.68
30	$219,666.68	$933.58	$1,040.53	$218,626.15
31	$218,626.15	$929.16	$1,044.95	$217,581.20
32	$217,581.20	$924.72	$1,049.39	$216,531.81
33	$216,531.81	$920.26	$1,053.85	$215,477.96
34	$215,477.96	$915.78	$1,058.33	$214,419.63
35	$214,419.63	$911.28	$1,062.83	$213,356.80
36	$213,356.80	$906.77	$1,067.34	$212,289.46
year 3 end
37	$212,289.46	$902.23	$1,071.88	$211,217.57
38	$211,217.57	$897.67	$1,076.44	$210,141.14
39	$210,141.14	$893.10	$1,081.01	$209,060.13
40	$209,060.13	$888.51	$1,085.60	$207,974.52
41	$207,974.52	$883.89	$1,090.22	$206,884.30
42	$206,884.30	$879.26	$1,094.85	$205,789.45
43	$205,789.45	$874.61	$1,099.50	$204,689.94
44	$204,689.94	$869.93	$1,104.18	$203,585.76
45	$203,585.76	$865.24	$1,108.87	$202,476.89
46	$202,476.89	$860.53	$1,113.58	$201,363.31
47	$201,363.31	$855.79	$1,118.32	$200,244.99
48	$200,244.99	$851.04	$1,123.07	$199,121.92
year 4 end
49	$199,121.92	$846.27	$1,127.84	$197,994.08
50	$197,994.08	$841.47	$1,132.64	$196,861.44
51	$196,861.44	$836.66	$1,137.45	$195,723.99
52	$195,723.99	$831.83	$1,142.28	$194,581.71
53	$194,581.71	$826.97	$1,147.14	$193,434.57
54	$193,434.57	$822.10	$1,152.01	$192,282.55
55	$192,282.55	$817.20	$1,156.91	$191,125.64
56	$191,125.64	$812.28	$1,161.83	$189,963.81
57	$189,963.81	$807.35	$1,166.76	$188,797.05
58	$188,797.05	$802.39	$1,171.72	$187,625.33
59	$187,625.33	$797.41	$1,176.70	$186,448.62
60	$186,448.62	$792.41	$1,181.70	$185,266.92
year 5 end
61	$185,266.92	$787.38	$1,186.73	$184,080.19
62	$184,080.19	$782.34	$1,191.77	$182,888.42
63	$182,888.42	$777.28	$1,196.83	$181,691.58
64	$181,691.58	$772.19	$1,201.92	$180,489.66
65	$180,489.66	$767.08	$1,207.03	$179,282.63
66	$179,282.63	$761.95	$1,212.16	$178,070.47
67	$178,070.47	$756.80	$1,217.31	$176,853.16
68	$176,853.16	$751.63	$1,222.48	$175,630.67
69	$175,630.67	$746.43	$1,227.68	$174,402.99
70	$174,402.99	$741.21	$1,232.90	$173,170.10
71	$173,170.10	$735.97	$1,238.14	$171,931.96
72	$171,931.96	$730.71	$1,243.40	$170,688.56
year 6 end
73	$170,688.56	$725.43	$1,248.68	$169,439.87
74	$169,439.87	$720.12	$1,253.99	$168,185.88
75	$168,185.88	$714.79	$1,259.32	$166,926.56
76	$166,926.56	$709.44	$1,264.67	$165,661.88
77	$165,661.88	$704.06	$1,270.05	$164,391.84
78	$164,391.84	$698.67	$1,275.44	$163,116.39
79	$163,116.39	$693.24	$1,280.87	$161,835.52
80	$161,835.52	$687.80	$1,286.31	$160,549.21
81	$160,549.21	$682.33	$1,291.78	$159,257.44
82	$159,257.44	$676.84	$1,297.27	$157,960.17
83	$157,960.17	$671.33	$1,302.78	$156,657.39
84	$156,657.39	$665.79	$1,308.32	$155,349.07
year 7 end
85	$155,349.07	$660.23	$1,313.88	$154,035.19
86	$154,035.19	$654.65	$1,319.46	$152,715.73
87	$152,715.73	$649.04	$1,325.07	$151,390.66
88	$151,390.66	$643.41	$1,330.70	$150,059.96
89	$150,059.96	$637.75	$1,336.36	$148,723.61
90	$148,723.61	$632.08	$1,342.03	$147,381.57
91	$147,381.57	$626.37	$1,347.74	$146,033.83
92	$146,033.83	$620.64	$1,353.47	$144,680.36
93	$144,680.36	$614.89	$1,359.22	$143,321.14
94	$143,321.14	$609.11	$1,365.00	$141,956.15
95	$141,956.15	$603.31	$1,370.80	$140,585.35
96	$140,585.35	$597.49	$1,376.62	$139,208.72
year 8 end
97	$139,208.72	$591.64	$1,382.47	$137,826.25
98	$137,826.25	$585.76	$1,388.35	$136,437.90
99	$136,437.90	$579.86	$1,394.25	$135,043.65
100	$135,043.65	$573.94	$1,400.17	$133,643.47
101	$133,643.47	$567.98	$1,406.13	$132,237.35
102	$132,237.35	$562.01	$1,412.10	$130,825.25
103	$130,825.25	$556.01	$1,418.10	$129,407.14
104	$129,407.14	$549.98	$1,424.13	$127,983.01
105	$127,983.01	$543.93	$1,430.18	$126,552.83
106	$126,552.83	$537.85	$1,436.26	$125,116.57
107	$125,116.57	$531.75	$1,442.36	$123,674.20
108	$123,674.20	$525.62	$1,448.49	$122,225.70
year 9 end
109	$122,225.70	$519.46	$1,454.65	$120,771.05
110	$120,771.05	$513.28	$1,460.83	$119,310.22
111	$119,310.22	$507.07	$1,467.04	$117,843.17
112	$117,843.17	$500.83	$1,473.28	$116,369.90
113	$116,369.90	$494.57	$1,479.54	$114,890.36
114	$114,890.36	$488.28	$1,485.83	$113,404.53
115	$113,404.53	$481.97	$1,492.14	$111,912.39
116	$111,912.39	$475.63	$1,498.48	$110,413.90
117	$110,413.90	$469.26	$1,504.85	$108,909.05
118	$108,909.05	$462.86	$1,511.25	$107,397.80
119	$107,397.80	$456.44	$1,517.67	$105,880.13
120	$105,880.13	$449.99	$1,524.12	$104,356.01
year 10 end
121	$104,356.01	$443.51	$1,530.60	$102,825.41
122	$102,825.41	$437.01	$1,537.10	$101,288.31
123	$101,288.31	$430.48	$1,543.63	$99,744.68
124	$99,744.68	$423.91	$1,550.20	$98,194.48
125	$98,194.48	$417.33	$1,556.78	$96,637.69
126	$96,637.69	$410.71	$1,563.40	$95,074.29
127	$95,074.29	$404.07	$1,570.04	$93,504.25
128	$93,504.25	$397.39	$1,576.72	$91,927.53
129	$91,927.53	$390.69	$1,583.42	$90,344.11
130	$90,344.11	$383.96	$1,590.15	$88,753.96
131	$88,753.96	$377.20	$1,596.91	$87,157.05
132	$87,157.05	$370.42	$1,603.69	$85,553.36
year 11 end
133	$85,553.36	$363.60	$1,610.51	$83,942.85
134	$83,942.85	$356.76	$1,617.35	$82,325.50
135	$82,325.50	$349.88	$1,624.23	$80,701.27
136	$80,701.27	$342.98	$1,631.13	$79,070.14
137	$79,070.14	$336.05	$1,638.06	$77,432.07
138	$77,432.07	$329.09	$1,645.02	$75,787.05
139	$75,787.05	$322.09	$1,652.02	$74,135.03
140	$74,135.03	$315.07	$1,659.04	$72,476.00
141	$72,476.00	$308.02	$1,666.09	$70,809.91
142	$70,809.91	$300.94	$1,673.17	$69,136.74
143	$69,136.74	$293.83	$1,680.28	$67,456.46
144	$67,456.46	$286.69	$1,687.42	$65,769.04
year 12 end
145	$65,769.04	$279.52	$1,694.59	$64,074.44
146	$64,074.44	$272.32	$1,701.79	$62,372.65
147	$62,372.65	$265.08	$1,709.03	$60,663.62
148	$60,663.62	$257.82	$1,716.29	$58,947.33
149	$58,947.33	$250.53	$1,723.58	$57,223.75
150	$57,223.75	$243.20	$1,730.91	$55,492.84
151	$55,492.84	$235.84	$1,738.27	$53,754.57
152	$53,754.57	$228.46	$1,745.65	$52,008.91
153	$52,008.91	$221.04	$1,753.07	$50,255.84
154	$50,255.84	$213.59	$1,760.52	$48,495.32
155	$48,495.32	$206.11	$1,768.00	$46,727.31
156	$46,727.31	$198.59	$1,775.52	$44,951.79
year 13 end
157	$44,951.79	$191.05	$1,783.06	$43,168.72
158	$43,168.72	$183.47	$1,790.64	$41,378.08
159	$41,378.08	$175.86	$1,798.25	$39,579.83
160	$39,579.83	$168.21	$1,805.90	$37,773.93
161	$37,773.93	$160.54	$1,813.57	$35,960.36
162	$35,960.36	$152.83	$1,821.28	$34,139.08
163	$34,139.08	$145.09	$1,829.02	$32,310.06
164	$32,310.06	$137.32	$1,836.79	$30,473.26
165	$30,473.26	$129.51	$1,844.60	$28,628.66
166	$28,628.66	$121.67	$1,852.44	$26,776.22
167	$26,776.22	$113.80	$1,860.31	$24,915.91
168	$24,915.91	$105.89	$1,868.22	$23,047.69
year 14 end
169	$23,047.69	$97.95	$1,876.16	$21,171.53
170	$21,171.53	$89.98	$1,884.13	$19,287.40
171	$19,287.40	$81.97	$1,892.14	$17,395.26
172	$17,395.26	$73.93	$1,900.18	$15,495.08
173	$15,495.08	$65.85	$1,908.26	$13,586.82
174	$13,586.82	$57.74	$1,916.37	$11,670.46
175	$11,670.46	$49.60	$1,924.51	$9,745.94
176	$9,745.94	$41.42	$1,932.69	$7,813.25
177	$7,813.25	$33.21	$1,940.90	$5,872.35
178	$5,872.35	$24.96	$1,949.15	$3,923.19
179	$3,923.19	$16.67	$1,957.44	$1,965.76
180	$1,965.76	$8.35	$1,965.76	$0.00
year 15 end

total interest paid = 107,340.03