Question

In: Finance

Sunrise Coffee just borrowed $160,000 to build a new shop. The mortgage loan is for 25...

Sunrise Coffee just borrowed $160,000 to build a new shop. The mortgage loan is for 25 years at an APR of 8.45% with equal monthly payments. How much interest will be paid during the final 4 years?

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Expert Solution

EMI = Loan / PVAF ( r%, n)

PVAF = SUm [ PVF ]

PVF (r%, n )= 1/(1+r)^n

r - Int Rate per month

n - No. of Months

EMI = Loan / PVAF ( r%, n)

= $ 160000 / PVAF ( 0.7042%, 300 )

= $ 160000 / 124.71

= $ 1282.98

Loan AMortization:

Month Opening Bal EMI Int Princeipal Repay Clsoing Bal
253 $ 52,101.20 $ 1,282.98 $    366.88 $    916.10 $ 51,185.10
254 $ 51,185.10 $ 1,282.98 $    360.43 $    922.55 $ 50,262.56
255 $ 50,262.56 $ 1,282.98 $    353.93 $    929.04 $ 49,333.51
256 $ 49,333.51 $ 1,282.98 $    347.39 $    935.59 $ 48,397.92
257 $ 48,397.92 $ 1,282.98 $    340.80 $    942.17 $ 47,455.75
258 $ 47,455.75 $ 1,282.98 $    334.17 $    948.81 $ 46,506.94
259 $ 46,506.94 $ 1,282.98 $    327.49 $    955.49 $ 45,551.45
260 $ 45,551.45 $ 1,282.98 $    320.76 $    962.22 $ 44,589.23
261 $ 44,589.23 $ 1,282.98 $    313.98 $    968.99 $ 43,620.24
262 $ 43,620.24 $ 1,282.98 $    307.16 $    975.82 $ 42,644.42
263 $ 42,644.42 $ 1,282.98 $    300.29 $    982.69 $ 41,661.73
264 $ 41,661.73 $ 1,282.98 $    293.37 $    989.61 $ 40,672.12
265 $ 40,672.12 $ 1,282.98 $    286.40 $    996.58 $ 39,675.55
266 $ 39,675.55 $ 1,282.98 $    279.38 $ 1,003.59 $ 38,671.95
267 $ 38,671.95 $ 1,282.98 $    272.31 $ 1,010.66 $ 37,661.29
268 $ 37,661.29 $ 1,282.98 $    265.20 $ 1,017.78 $ 36,643.51
269 $ 36,643.51 $ 1,282.98 $    258.03 $ 1,024.95 $ 35,618.57
270 $ 35,618.57 $ 1,282.98 $    250.81 $ 1,032.16 $ 34,586.40
271 $ 34,586.40 $ 1,282.98 $    243.55 $ 1,039.43 $ 33,546.97
272 $ 33,546.97 $ 1,282.98 $    236.23 $ 1,046.75 $ 32,500.22
273 $ 32,500.22 $ 1,282.98 $    228.86 $ 1,054.12 $ 31,446.10
274 $ 31,446.10 $ 1,282.98 $    221.43 $ 1,061.54 $ 30,384.56
275 $ 30,384.56 $ 1,282.98 $    213.96 $ 1,069.02 $ 29,315.54
276 $ 29,315.54 $ 1,282.98 $    206.43 $ 1,076.55 $ 28,238.99
277 $ 28,238.99 $ 1,282.98 $    198.85 $ 1,084.13 $ 27,154.87
278 $ 27,154.87 $ 1,282.98 $    191.22 $ 1,091.76 $ 26,063.10
279 $ 26,063.10 $ 1,282.98 $    183.53 $ 1,099.45 $ 24,963.66
280 $ 24,963.66 $ 1,282.98 $    175.79 $ 1,107.19 $ 23,856.46
281 $ 23,856.46 $ 1,282.98 $    167.99 $ 1,114.99 $ 22,741.48
282 $ 22,741.48 $ 1,282.98 $    160.14 $ 1,122.84 $ 21,618.64
283 $ 21,618.64 $ 1,282.98 $    152.23 $ 1,130.75 $ 20,487.89
284 $ 20,487.89 $ 1,282.98 $    144.27 $ 1,138.71 $ 19,349.19
285 $ 19,349.19 $ 1,282.98 $    136.25 $ 1,146.73 $ 18,202.46
286 $ 18,202.46 $ 1,282.98 $    128.18 $ 1,154.80 $ 17,047.66
287 $ 17,047.66 $ 1,282.98 $    120.04 $ 1,162.93 $ 15,884.73
288 $ 15,884.73 $ 1,282.98 $    111.85 $ 1,171.12 $ 14,713.60
289 $ 14,713.60 $ 1,282.98 $    103.61 $ 1,179.37 $ 13,534.24
290 $ 13,534.24 $ 1,282.98 $      95.30 $ 1,187.67 $ 12,346.56
291 $ 12,346.56 $ 1,282.98 $      86.94 $ 1,196.04 $ 11,150.53
292 $ 11,150.53 $ 1,282.98 $      78.52 $ 1,204.46 $   9,946.07
293 $   9,946.07 $ 1,282.98 $      70.04 $ 1,212.94 $   8,733.13
294 $   8,733.13 $ 1,282.98 $      61.50 $ 1,221.48 $   7,511.65
295 $   7,511.65 $ 1,282.98 $      52.89 $ 1,230.08 $   6,281.56
296 $   6,281.56 $ 1,282.98 $      44.23 $ 1,238.74 $   5,042.82
297 $   5,042.82 $ 1,282.98 $      35.51 $ 1,247.47

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