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Aninvestor buys a property for $687,000 with a​ 25-year mortgage andmonthly payments at 6.3​%...

An investor buys a property for $687,000 with a 25-year mortgage and monthly payments at 6.3% APR. After 18 months the investor resells the property for $749,484. How much cash will the investor have made from the sale, once the mortgage is paid off?

Solutions

Expert Solution

Loan amount = $687,000

Calculating the Loan balance after 18 months:-

Where, P = Loan amount = $687,000

r = Periodic Interest rate = 6.3%/12 = 0.525%

n= no of periods = 25 years*12 = 300

m = no of periods of payments already made = 18

Outstanding Loan balance after 18 months= $669,182.24

- Investor sells the Property after 18 months for $749,484

Cash made by Investor from selling the property = $749,484 - 669,182.24

= $80,301.76

jeff jeffy answered 2 years ago
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