Question

Professor bought an investment property for $400,000. He took out a standard 30 year fixed mortgage for $244000 at a nominal rate of 4.875% per year, with uniform monthly payments starting one month from the date of closing. He paid all of the loans closing costs. What were his monthly mortgage payments? $

Exactly 5 years to the day he sold the property for $475,000. Assuming that he had already made his mortgage payment that day what was the remaining balance of the mortgage? $

How much of his final payment was interest? $

How much of his final payment went toward principle? $ (note his final payment was his 60th payment, because he sold the property after 5 years)

Answer 1

Here r = 4.875%/12 = 0.40625% , n = 30 *12 =360

Installment = Loan/PVIFA(0.40625%,360)

=244000/188.9615

=1291.268

repayment schedule

month	opening balance	installment	Interest @ 0.40625%	Principal	Closing balance
1	244000	1291.27	991.25	300.02	243699.98
2	243699.98	1291.27	990.0311769	301.24	243398.75
3	243398.75	1291.27	988.8074023	302.46	243096.28
4	243096.28	1291.27	987.5786561	303.69	242792.60
5	242792.60	1291.27	986.3449181	304.92	242487.67
6	242487.67	1291.27	985.1061681	306.16	242181.51
7	242181.51	1291.27	983.8623857	307.41	241874.10
8	241874.10	1291.27	982.6135504	308.65	241565.45
9	241565.45	1291.27	981.3596417	309.91	241255.54
10	241255.54	1291.27	980.100639	311.17	240944.37
11	240944.37	1291.27	978.8365216	312.43	240631.94
12	240631.94	1291.27	977.5672687	313.70	240318.24
13	240318.24	1291.27	976.2928595	314.98	240003.27
14	240003.27	1291.27	975.013273	316.25	239687.01
15	239687.01	1291.27	973.7284881	317.54	239369.47
16	239369.47	1291.27	972.4384839	318.83	239050.64
17	239050.64	1291.27	971.1432389	320.12	238730.52
18	238730.52	1291.27	969.8427321	321.43	238409.09
19	238409.09	1291.27	968.536942	322.73	238086.36
20	238086.36	1291.27	967.225847	324.04	237762.32
21	237762.32	1291.27	965.9094258	325.36	237436.96
22	237436.96	1291.27	964.5876566	326.68	237110.28
23	237110.28	1291.27	963.2605177	328.01	236782.27
24	236782.27	1291.27	961.9279873	329.34	236452.93
25	236452.93	1291.27	960.5900435	330.68	236122.26
26	236122.26	1291.27	959.2466643	332.02	235790.23
27	235790.23	1291.27	957.8978276	333.37	235456.86
28	235456.86	1291.27	956.5435113	334.72	235122.14
29	235122.14	1291.27	955.183693	336.08	234786.06
30	234786.06	1291.27	953.8183505	337.45	234448.61
31	234448.61	1291.27	952.4474613	338.82	234109.79
32	234109.79	1291.27	951.0710029	340.20	233769.59
33	233769.59	1291.27	949.6889526	341.58	233428.01
34	233428.01	1291.27	948.3012877	342.97	233085.04
35	233085.04	1291.27	946.9079855	344.36	232740.68
36	232740.68	1291.27	945.5090229	345.76	232394.92
37	232394.92	1291.27	944.1043771	347.16	232047.76
38	232047.76	1291.27	942.6940248	348.57	231699.19
39	231699.19	1291.27	941.2779431	349.99	231349.20
40	231349.20	1291.27	939.8561085	351.41	230997.78
41	230997.78	1291.27	938.4284976	352.84	230644.94
42	230644.94	1291.27	936.9950872	354.27	230290.67
43	230290.67	1291.27	935.5558535	355.71	229934.96
44	229934.96	1291.27	934.1107729	357.16	229577.80
45	229577.80	1291.27	932.6598216	358.61	229219.19
46	229219.19	1291.27	931.2029759	360.07	228859.13
47	228859.13	1291.27	929.7402117	361.53	228497.60
48	228497.60	1291.27	928.2715051	363.00	228134.60
49	228134.60	1291.27	926.7968318	364.47	227770.13
50	227770.13	1291.27	925.3161677	365.95	227404.18
51	227404.18	1291.27	923.8294884	367.44	227036.74
52	227036.74	1291.27	922.3367695	368.93	226667.81
53	226667.81	1291.27	920.8379863	370.43	226297.38
54	226297.38	1291.27	919.3331144	371.93	225925.45
55	225925.45	1291.27	917.8221289	373.45	225552.00
56	225552.00	1291.27	916.3050051	374.96	225177.04
57	225177.04	1291.27	914.7817179	376.49	224800.55
58	224800.55	1291.27	913.2522424	378.02	224422.54
59	224422.54	1291.27	911.7165534	379.55	224042.98
60	224042.98	1291.27	910.1746256	381.09	223661.89

balance after 5 years = 223661.89$

Payment toward interest in last Installment = 910.1746$

payment towards Principal in last Installment = 381.09$