Question

You want to buy a house that worth $250,000. You put done $60,000 down payment and borrow the rest from a bank with interest rate 4.5% per year compounded monthly for 15 years. What is you monthly payment to the bank? How much interest you will pay to the bank in 15 years? How much interest you pay in the FIRST year?

Answer 1

Using financial calculator BA II Plus - Input details:	#
I/Y = Rate = 4.5/12 =	0.375000
FV = Future value =	$0
N = Total payment term = 12 x 15 Years =	180
PV = Present value of loan = -(250000-60000) =	-$190,000
CPT > PMT = Monthly Payment =	$1,453.49

Total amount paid over life of the loan = PMT x N = 1453.49 x 180 =	$261,627.70
Total Interest paid = Total amount paid over life of the loan - Principal loan
Total Interest paid in 15 years = 261627.70-190000 =	$71,627.70

Interest in first Year = $8,364.29

Total of interest column = $8,364.29

Year	Beginning Balance	Payment	Interest	Repayment of principal	Ending balance
Y	OP	PMT	I = OP x 4.5%/12	AM = PMT - I	CB
1	$190,000.00	$1,453.49	712.50	$740.99	$189,259.01
2	189,259.01	$1,453.49	709.72	$743.77	188,515.25
3	188,515.25	$1,453.49	706.93	$746.56	187,768.69
4	187,768.69	$1,453.49	704.13	749.35	187,019.34
5	187,019.34	$1,453.49	701.32	752.16	186,267.17
6	186,267.17	$1,453.49	698.50	754.99	185,512.19
7	185,512.19	$1,453.49	695.67	757.82	184,754.37
8	184,754.37	$1,453.49	692.83	760.66	183,993.71
9	183,993.71	$1,453.49	689.98	763.51	183,230.20
10	183,230.20	$1,453.49	687.11	766.37	182,463.83
11	182,463.83	$1,453.49	684.24	769.25	181,694.58
12	181,694.58	$1,453.49	681.35	772.13	180,922.45
		Total	8,364.29