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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