Question

Suppose you have taken out a $325,000 fully amortizing fixed rate mortgage loan that has a term of 30 years and an interest rate of 5.5%. In month 10 of the mortgage, how much of the monthly mortgage payment does the interest portion consist of?

Answer 1

Interest expense in the 10th payment is   $ 1,474.64

Step-1:Calculation of monthly payment
Monthly payment		=	=pmt(rate,nper,pv)
		=	$         1,845.31
Where,
rate		=	5.5%/12	=	0.004583333
nper		=	30*12	=	360
pv				=	$     -3,25,000
Step-2:Calculation of interest expense in the 10th payment
Payment month	Beginning loan	Interest expense	Monthly payment	Reduction of Loan	Ending Loan Payment
1	$ 3,25,000.00	$ 1,489.58	$         1,845.31	$ 355.73	$ 3,24,644.27
2	$ 3,24,644.27	$ 1,487.95	$         1,845.31	$ 357.36	$ 3,24,286.91
3	$ 3,24,286.91	$ 1,486.31	$         1,845.31	$ 359.00	$ 3,23,927.91
4	$ 3,23,927.91	$ 1,484.67	$         1,845.31	$ 360.64	$ 3,23,567.26
5	$ 3,23,567.26	$ 1,483.02	$         1,845.31	$ 362.30	$ 3,23,204.97
6	$ 3,23,204.97	$ 1,481.36	$         1,845.31	$ 363.96	$ 3,22,841.01
7	$ 3,22,841.01	$ 1,479.69	$         1,845.31	$ 365.63	$ 3,22,475.38
8	$ 3,22,475.38	$ 1,478.01	$         1,845.31	$ 367.30	$ 3,22,108.08
9	$ 3,22,108.08	$ 1,476.33	$         1,845.31	$ 368.99	$ 3,21,739.09
10	$ 3,21,739.09	$ 1,474.64	$         1,845.31	$ 370.68	$ 3,21,368.42