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A 25 years $500000 mortgage at 4.30% compounded semi annually is repaid with monthly payment what...

A 25 years $500000 mortgage at 4.30% compounded semi annually is repaid with monthly payment what is size of monthly payment and balance of mortgage at end of 6 years and how much did the amortization period shorten by if the monthly payment are increased by $125 at end of year six?

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Expert Solution

At the end of year 6 the Principle balance is $423,325.97, the monthly installments are $2,711.49 from Month 1 to 72.

Payment Number Payment Principal Interest Balance
1 $             -2,711.49 $                      -936.49 $                  -1,775.00 $ 499,063.51
2 $             -2,711.49 $                      -939.82 $                  -1,771.68 $ 498,123.69
3 $             -2,711.49 $                      -943.15 $                  -1,768.34 $ 497,180.54
4 $             -2,711.49 $                      -946.50 $                  -1,764.99 $ 496,234.04
5 $             -2,711.49 $                      -949.86 $                  -1,761.63 $ 495,284.18
6 $             -2,711.49 $                      -953.23 $                  -1,758.26 $ 494,330.95
7 $             -2,711.49 $                      -956.62 $                  -1,754.87 $ 493,374.33
8 $             -2,711.49 $                      -960.01 $                  -1,751.48 $ 492,414.32
9 $             -2,711.49 $                      -963.42 $                  -1,748.07 $ 491,450.90
10 $             -2,711.49 $                      -966.84 $                  -1,744.65 $ 490,484.06
11 $             -2,711.49 $                      -970.27 $                  -1,741.22 $ 489,513.79
12 $             -2,711.49 $                      -973.72 $                  -1,737.77 $ 488,540.07
13 $             -2,711.49 $                      -977.17 $                  -1,734.32 $ 487,562.90
14 $             -2,711.49 $                      -980.64 $                  -1,730.85 $ 486,582.26
15 $             -2,711.49 $                      -984.12 $                  -1,727.37 $ 485,598.13
16 $             -2,711.49 $                      -987.62 $                  -1,723.87 $ 484,610.51
17 $             -2,711.49 $                      -991.12 $                  -1,720.37 $ 483,619.39
18 $             -2,711.49 $                      -994.64 $                  -1,716.85 $ 482,624.75
19 $             -2,711.49 $                      -998.17 $                  -1,713.32 $ 481,626.58
20 $             -2,711.49 $                   -1,001.72 $                  -1,709.77 $ 480,624.86
21 $             -2,711.49 $                   -1,005.27 $                  -1,706.22 $ 479,619.59
22 $             -2,711.49 $                   -1,008.84 $                  -1,702.65 $ 478,610.74
23 $             -2,711.49 $                   -1,012.42 $                  -1,699.07 $ 477,598.32
24 $             -2,711.49 $                   -1,016.02 $                  -1,695.47 $ 476,582.30
25 $             -2,711.49 $                   -1,019.62 $                  -1,691.87 $ 475,562.68
26 $             -2,711.49 $                   -1,023.24 $                  -1,688.25 $ 474,539.44
27 $             -2,711.49 $                   -1,026.88 $                  -1,684.62 $ 473,512.56
28 $             -2,711.49 $                   -1,030.52 $                  -1,680.97 $ 472,482.04
29 $             -2,711.49 $                   -1,034.18 $                  -1,677.31 $ 471,447.86
30 $             -2,711.49 $                   -1,037.85 $                  -1,673.64 $ 470,410.01
31 $             -2,711.49 $                   -1,041.54 $                  -1,669.96 $ 469,368.47
32 $             -2,711.49 $                   -1,045.23 $                  -1,666.26 $ 468,323.24
33 $             -2,711.49 $                   -1,048.94 $                  -1,662.55 $ 467,274.30
34 $             -2,711.49 $                   -1,052.67 $                  -1,658.82 $ 466,221.63
35 $             -2,711.49 $                   -1,056.40 $                  -1,655.09 $ 465,165.23
36 $             -2,711.49 $                   -1,060.15 $                  -1,651.34 $ 464,105.07
37 $             -2,711.49 $                   -1,063.92 $                  -1,647.57 $ 463,041.15
38 $             -2,711.49 $                   -1,067.69 $                  -1,643.80 $ 461,973.46
39 $             -2,711.49 $                   -1,071.49 $                  -1,640.01 $ 460,901.97
40 $             -2,711.49 $                   -1,075.29 $                  -1,636.20 $ 459,826.69
41 $             -2,711.49 $                   -1,079.11 $                  -1,632.38 $ 458,747.58
42 $             -2,711.49 $                   -1,082.94 $                  -1,628.55 $ 457,664.64
43 $             -2,711.49 $                   -1,086.78 $                  -1,624.71 $ 456,577.86
44 $             -2,711.49 $                   -1,090.64 $                  -1,620.85 $ 455,487.22
45 $             -2,711.49 $                   -1,094.51 $                  -1,616.98 $ 454,392.71
46 $             -2,711.49 $                   -1,098.40 $                  -1,613.09 $ 453,294.31
47 $             -2,711.49 $                   -1,102.30 $                  -1,609.19 $ 452,192.02
48 $             -2,711.49 $                   -1,106.21 $                  -1,605.28 $ 451,085.81
49 $             -2,711.49 $                   -1,110.14 $                  -1,601.35 $ 449,975.67
50 $             -2,711.49 $                   -1,114.08 $                  -1,597.41 $ 448,861.59
51 $             -2,711.49 $                   -1,118.03 $                  -1,593.46 $ 447,743.56
52 $             -2,711.49 $                   -1,122.00 $                  -1,589.49 $ 446,621.56
53 $             -2,711.49 $                   -1,125.98 $                  -1,585.51 $ 445,495.58
54 $             -2,711.49 $                   -1,129.98 $                  -1,581.51 $ 444,365.59
55 $             -2,711.49 $                   -1,133.99 $                  -1,577.50 $ 443,231.60
56 $             -2,711.49 $                   -1,138.02 $                  -1,573.47 $ 442,093.58
57 $             -2,711.49 $                   -1,142.06 $                  -1,569.43 $ 440,951.52
58 $             -2,711.49 $                   -1,146.11 $                  -1,565.38 $ 439,805.41
59 $             -2,711.49 $                   -1,150.18 $                  -1,561.31 $ 438,655.23
60 $             -2,711.49 $                   -1,154.26 $                  -1,557.23 $ 437,500.96
61 $             -2,711.49 $                   -1,158.36 $                  -1,553.13 $ 436,342.60
62 $             -2,711.49 $                   -1,162.47 $                  -1,549.02 $ 435,180.13
63 $             -2,711.49 $                   -1,166.60 $                  -1,544.89 $ 434,013.53
64 $             -2,711.49 $                   -1,170.74 $                  -1,540.75 $ 432,842.78
65 $             -2,711.49 $                   -1,174.90 $                  -1,536.59 $ 431,667.88
66 $             -2,711.49 $                   -1,179.07 $                  -1,532.42 $ 430,488.81
67 $             -2,711.49 $                   -1,183.26 $                  -1,528.24 $ 429,305.56
68 $             -2,711.49 $                   -1,187.46 $                  -1,524.03 $ 428,118.10
69 $             -2,711.49 $                   -1,191.67 $                  -1,519.82 $ 426,926.43
70 $             -2,711.49 $                   -1,195.90 $                  -1,515.59 $ 425,730.53
71 $             -2,711.49 $                   -1,200.15 $                  -1,511.34 $ 424,530.38
72 $             -2,711.49 $                   -1,204.41 $                  -1,507.08 $ 423,325.97

New Monthly payment amount = $2,836.49. The remaining amortization period is 212.95 months or 17.75 years approx. The amortization period has been shortened by 1.25 years.

Formula used =NPER(EffRate/12,Payment, -Principal)

jeff jeffy answered 2 years ago
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