Question

In: Finance

Consider a 30-year mortgage with an interest rate of 10% compounded monthly and a monthly payment...

Consider a 30-year mortgage with an interest rate of 10% compounded monthly and a monthly payment
of $850.

(5) What is the total amount of interest paid during the 30 years?
(6) What is the unpaid balance after 25 years?
(7) How much has to be deposited into a savings account with an interest rate of 4% compounded
quarterly in order to pay the unpaid balance of the mortgage after 25 years?
(8) How much has to be deposited each quarter year in a fund with an interest rate of 8% compounded
quarterly in order to cover the unpaid balance after 25 years?

Solutions

Expert Solution

Original loan $96,858.20
5 Interest paid = Number of payments
*Payment - Originalamount		 $209,141.80
6 Principal paid after 25 years -56852.6333
Balance unpaid $40,005.56
7 Amount to deposit in savings $234.66
8 Amount to deposit in fund $128.13

Workings

jeff jeffy answered 6 months ago
Next > < Previous

Related Solutions

Consider a 30-year mortgage with an interest rate of 10% compounded monthly and a monthly payment...
Consider a 30-year mortgage with an interest rate of 10% compounded monthly and a monthly payment of $850. (1) Calculate the principal. (2) How much of the principal is paid the first, 5th, 20th and last year? (3) How much interest is paid the first, 5th, 20th and last year year? (4) What is the total amount of money paid during the 30 years? (5) What is the total amount of interest paid during the 30 years? (6) What is...
What is the monthly mortgage payment on a $300,000 30 year fixed rate mortgage with an...
What is the monthly mortgage payment on a $300,000 30 year fixed rate mortgage with an interest rate of 5.125 percent. A friend who knows you have studied amortization asks your help to find the interest portion of their house payments for tax purposes (assuming they itemize). The monthly payments are $2,107.02 on a 30 year loan with a 5 percent interest rate. a) What was the total amount of interest paid during year 2? b) At what point in...
Consider a $329,000; 4.2%; 30 year mortgage. (monthly payment and monthly compounding). a. If a borrower...
Consider a $329,000; 4.2%; 30 year mortgage. (monthly payment and monthly compounding). a. If a borrower submits an extra $10,000 towards principal along with the 36th payment, and if all other payments are made according to schedule, what's the projected balance at the end of the 5th year? b. (Ignoring 5a) If you just turned 23 years old on the day this 30-year mortgage was originated, but would like to have the entire mortgage paid off by the time you...
Consider a 6%, 30 year, $200,000 level payment mortgage with a monthly payment of $1,199.10. Assume...
Consider a 6%, 30 year, $200,000 level payment mortgage with a monthly payment of $1,199.10. Assume up front financing cost (includes all costs paid to the lender and third parties except discount points) equal $3,000. Find the EBC if the borrower repays the loan after two years (assuming no direct points). What is the EBC if the lender charges one discount point? What is the EBC if the lender charges 2.5 discount point?
On a 30-year, fixed-rate loan with a monthly payment of $1,000 and an interest rate of...
On a 30-year, fixed-rate loan with a monthly payment of $1,000 and an interest rate of 9%, what is the outstanding balance due on the loan with after the borrower has made 18 years of payments?
What will be the monthly payment on a $75,000 30-year home mortgage at 1% interest per...
What will be the monthly payment on a $75,000 30-year home mortgage at 1% interest per month?
Mortgage Payment You currently have a 30-year fixed rate mortgage with an annual interest rate of...
Mortgage Payment You currently have a 30-year fixed rate mortgage with an annual interest rate of 6%. You have had the mortgage 4 years, and on September 1, 2015 you made your 48th payment. The original principal amount was $280,000 and you monthly payment, without taxes and insurance, are $1,678.74 per month, computed using the Excel function =PMT(0.5%,360,280000,0,0). Starting with your original mortgage your banker calls and says that you could refinance your existing mortgage (6% rate, 30-year original term)...
a Financial institution offers a 10 year mortgage at an annual rate of 6% compounded monthly....
a Financial institution offers a 10 year mortgage at an annual rate of 6% compounded monthly. a. the monthly payment for $150,000 mortgage? b. The principle that remain after seven years? c. the new payment if the interest-rate goes up to 8.4% after seven years d. The total interest paid on the loan if the interest rate changes as described in part C?
In underwriting a new 30-year, monthly payment mortgage loan at5% interest for Jackie, the lender...
In underwriting a new 30-year, monthly payment mortgage loan at 5% interest for Jackie, the lender requires that Jackie meet three ratios to be approved for the loan.First, the payment on her loan plus the monthly cost of homeowner's insurance of $200 plus monthly property taxes of $225 plus monthly home owner association fees of $100 can be no more than 28% of her gross monthly income.Second, the monthly total of the four items above plus her car loan payment...
Consider a 30-year, $300,000 mortgage with monthly payments and a nominal rate (monthly compounding) of 6.50%....
Consider a 30-year, $300,000 mortgage with monthly payments and a nominal rate (monthly compounding) of 6.50%. What portion of the first 35 payments goes toward paying principal? the answer is 15.70% but I don't know how to get the answer with a HP 10bII+ financial calculator, so if possible brake down the steps for me
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT