Question
In: Finance
You took out a fully amortizing 30 year mortgage with the initial balance of $199,755. This...
You took out a fully amortizing 30 year mortgage with the initial balance of $199,755. This mortgage has a fixed interest rate at 4%. After you completed two full years of monthly payments, how much have you paid toward principal? Round your answer to the nearest cent (e.g. if your answer is $7000.9873, enter 7000.99).
Solutions
Expert Solution
Ans $ 7178.84
| P = | Regular Payments | |||
| PV = | Loan Amount | |||
| r = | rate of interest | |||
| n = | no of periods | |||
| P = | r (PV) | |||
| 1 - (1 + r )^-n | ||||
| P = | (4%/12)*199755 | |||
| 1 - (1 / (1 + 4%/12)^360)) | ||||
| P = | 665.85 | |||
| 0.698204135 | ||||
| P = | 953.66 | |||
| Beginning Balance | Interest | Principal | Ending Balance | |
| 1 | 1,99,755.00 | 665.85 | 287.81 | 199467.19 |
| 2 | 1,99,467.19 | 664.89 | 288.77 | 1,99,178.42 |
| 3 | 1,99,178.42 | 663.93 | 289.73 | 1,98,888.69 |
| 4 | 1,98,888.69 | 662.96 | 290.7 | 1,98,597.99 |
| 5 | 1,98,597.99 | 661.99 | 291.67 | 1,98,306.32 |
| 6 | 1,98,306.32 | 661.02 | 292.64 | 1,98,013.68 |
| 7 | 1,98,013.68 | 660.05 | 293.62 | 1,97,720.06 |
| 8 | 1,97,720.06 | 659.07 | 294.59 | 1,97,425.47 |
| 9 | 1,97,425.47 | 658.08 | 295.58 | 1,97,129.89 |
| 10 | $1,97,129.89 | $657.10 | $296.56 | $1,96,833.33 |
| 11 | $1,96,833.33 | $656.11 | $297.55 | $1,96,535.78 |
| 12 | $1,96,535.78 | $655.12 | $298.54 | $1,96,237.24 |
| 13 | $1,96,237.24 | $654.12 | $299.54 | $1,95,937.70 |
| 14 | $1,95,937.70 | $653.13 | $300.54 | $1,95,637.17 |
| 15 | $1,95,637.17 | $652.12 | $301.54 | $1,95,335.63 |
| 16 | $1,95,335.63 | $651.12 | $302.54 | $1,95,033.09 |
| 17 | $1,95,033.09 | $650.11 | $303.55 | $1,94,729.54 |
| 18 | $1,94,729.54 | $649.10 | $304.56 | $1,94,424.98 |
| 19 | $1,94,424.98 | $648.08 | $305.58 | $1,94,119.40 |
| 20 | $1,94,119.40 | $647.06 | $306.60 | $1,93,812.80 |
| 21 | $1,93,812.80 | $646.04 | $307.62 | $1,93,505.19 |
| 22 | $1,93,505.19 | $645.02 | $308.64 | $1,93,196.54 |
| 23 | $1,93,196.54 | $643.99 | $309.67 | $1,92,886.87 |
| 24 | $1,92,886.87 | $642.96 | $310.70 | $1,92,576.16 |
| TOTAL | 15709.02 | 7178.84 |
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