Wally has just bought a house by taking a 30-year, $127,500 mortgage from the bank. The...

Wally has just bought a house by taking a 30-year, $127,500 mortgage from the bank. The interest rate is 8.25%. The mortgage is to be retired by payments made every month starting next month. How much does Wally have to pay each month to repay the mortgage? What would the monthly payments be if Wally opts for a 15-year mortgage at the same interest rate?

Solutions

Expert Solution

Calculating Monthly payment,

Using TVM Calculation,

PMT = [PV = 127,500, FV = 0, N = 360, I = 0.0825/12]

PMT = $957.86

Calculating Monthly payment on 15 year loan,

Using TVM Calculation,

PMT = [PV = 127,500, FV = 0, N = 180, I = 0.0825/12]

PMT = $1,236.93

jeff jeffy answered 2 years ago

Next > < Previous

Related Solutions

Jackie bought a $200,000 house and has a 30 year mortgage at anominal interest rate...

Jackie bought a $200,000 house and has a 30 year mortgage at a nominal interest rate of 4.8% convertible monthly. Jackie must pay level payments at the end of each month. Find the amount of her monthly mortgage payment. After 200 payments have been made, what is the ratio of total interest paid to total principal repaid?

John and Peggy recently bought a house. They financed the house with a $150,000, 30-year mortgage...

John and Peggy recently bought a house. They financed the house with a $150,000, 30-year mortgage with a nominal interest rate of 6.68%. Mortgage payments are made at the end of each month. What total dollar amount of their mortgage payments during the first 4 years will go towards repayment of principal?

you just bought a house and have a $188,000 mortgage. the mortgage is for 15 years...

you just bought a house and have a $188,000 mortgage. the mortgage is for 15 years and has a nominal rate of 4.25%.on the 24th payment what will be the amount going to principal?

Jayce is borrowing $148,000 to buy a house. He is taking out a 30 year mortgage...

Jayce is borrowing $148,000 to buy a house. He is taking out a 30 year mortgage with a 5.35% fixed interest rate. Property taxes are $4,975 and homeowners insurance is $1125 per year. PMI is $75 per month. Find his total monthly (PITI) payment. Show your work.

Five years ago, Marcus bought a house. He secured a mortgage from his bank for $1,720,000....

Five years ago, Marcus bought a house. He secured a mortgage from his bank for $1,720,000. The mortgage had monthly payments for 20 years with an interest rate of 6.0% compounded monthly. However, after five years, it is time to renegotiate the mortgage. Interest rates have fallen to 4.5% compounded monthly, and Marcus still intends to make monthly payments and to pay back the debt over the remaining 15 years. a) How much were Marcus' initial monthly payments? b) What...

Bubba bought his house 20 years ago, he is borrowed $200,000 with a 30-year mortgage with...

Bubba bought his house 20 years ago, he is borrowed $200,000 with a 30-year mortgage with a 5.0% APR. His mortgage broker has offered him a 10-year mortgage with a 4% APR with 3 points closing costs. What is Charlie's old monthly payment? What is the balance on Bubba's mortgage? What is Bubba's new monthly payment? What are Bubba's present value savings after paying the points if he plans to live in the house until the mortgage is paid off?

You have just sold your house for$1,000,000 in cash. Your mortgage was originally a 30-year mortgage...

You have just sold your house for$1,000,000 in cash. Your mortgage was originally a 30-year mortgage with monthly payments and an initial balance of$800,000.The mortgage is currently exactly 18½ years old, and you have just made a payment. If the interest rate on the mortgage is 5.25% (APR), how much cash will you have from the sale once you pay off the mortgage? (Note: Be careful not to round any intermediate steps less than six decimal places.) Cash that remains...

The Rialto family bought a house 10 years ago, taking out a mortgage loan for $249,500...

The Rialto family bought a house 10 years ago, taking out a mortgage loan for $249,500 at 7% interest for 30 years. They've made all of their monthly payments on time for the past 10 years. With 20 years left on the loan, how much does the Rialto family still owe on the mortgage? (Hint: first you will need to figure out the monthly payment on the 30 year loan.)

You just bought a house and borrowed 15-year mortgage at 5% APR, compounded monthly. Your loan...

You just bought a house and borrowed 15-year mortgage at 5% APR, compounded monthly. Your loan amount is $250,000. Calculate your monthly payment Calculate the principal and interest portions of your 1st and last payment Calculate how much principal and interest you paid within 5 years and your outstanding balance at the end of the fifth year.

You have just bought a house and have taken out a mortgage (an installment) loan for...

You have just bought a house and have taken out a mortgage (an installment) loan for $500,000. This is a 30-year loan that requires monthly payments and the first payment is due one month from today. The APR for the loan is 24%. You are interested to know how much of your 210th monthly payment will go toward the repayment of principal? That amount is _______________ Question 10 options: $762.65 $9,586.98 $625.64 $9,494.78 $513.24 $9,382.38 $421.04 $9,245.37

Subjects