Question

In: Finance

Suppose you take a fixed-rate mortgage for $200,000 at 5.00% for 30 years, monthly payments. 1)...

Suppose you take a fixed-rate mortgage for $200,000 at 5.00% for 30 years, monthly payments.

1) How much of the payment is interest for month 100? How much interest do you pay in the first six years?

Solutions

Expert Solution

For this we need to create amortization table till 100 months

Beginning Balance= 200,000 PMT =PMT(5%/12,360,-200000) Interest part of PMT=5%/12*Beginning Principal Principal part of PMT= PMT-Interest Ending Balance= Beginning balance-Principal part of PMT
1 200000.00 1073.64 833.33 240.31 199759.69
2 199759.69 1073.64 832.33 241.31 199518.38
3 199518.38 1073.64 831.33 242.32 199276.06
4 199276.06 1073.64 830.32 243.33 199032.74
5 199032.74 1073.64 829.30 244.34 198788.40
6 198788.40 1073.64 828.28 245.36 198543.04
7 198543.04 1073.64 827.26 246.38 198296.66
8 198296.66 1073.64 826.24 247.41 198049.25
9 198049.25 1073.64 825.21 248.44 197800.81
10 197800.81 1073.64 824.17 249.47 197551.34
11 197551.34 1073.64 823.13 250.51 197300.83
12 197300.83 1073.64 822.09 251.56 197049.27
13 197049.27 1073.64 821.04 252.60 196796.66
14 196796.66 1073.64 819.99 253.66 196543.01
15 196543.01 1073.64 818.93 254.71 196288.29
16 196288.29 1073.64 817.87 255.78 196032.52
17 196032.52 1073.64 816.80 256.84 195775.68
18 195775.68 1073.64 815.73 257.91 195517.77
19 195517.77 1073.64 814.66 258.99 195258.78
20 195258.78 1073.64 813.58 260.06 194998.71
21 194998.71 1073.64 812.49 261.15 194737.57
22 194737.57 1073.64 811.41 262.24 194475.33
23 194475.33 1073.64 810.31 263.33 194212.00
24 194212.00 1073.64 809.22 264.43 193947.57
25 193947.57 1073.64 808.11 265.53 193682.05
26 193682.05 1073.64 807.01 266.63 193415.41
27 193415.41 1073.64 805.90 267.75 193147.66
28 193147.66 1073.64 804.78 268.86 192878.80
29 192878.80 1073.64 803.66 269.98 192608.82
30 192608.82 1073.64 802.54 271.11 192337.72
31 192337.72 1073.64 801.41 272.24 192065.48
32 192065.48 1073.64 800.27 273.37 191792.11
33 191792.11 1073.64 799.13 274.51 191517.60
34 191517.60 1073.64 797.99 275.65 191241.95
35 191241.95 1073.64 796.84 276.80 190965.14
36 190965.14 1073.64 795.69 277.96 190687.19
37 190687.19 1073.64 794.53 279.11 190408.08
38 190408.08 1073.64 793.37 280.28 190127.80
39 190127.80 1073.64 792.20 281.44 189846.36
40 189846.36 1073.64 791.03 282.62 189563.74
41 189563.74 1073.64 789.85 283.79 189279.94
42 189279.94 1073.64 788.67 284.98 188994.97
43 188994.97 1073.64 787.48 286.16 188708.80
44 188708.80 1073.64 786.29 287.36 188421.45
45 188421.45 1073.64 785.09 288.55 188132.89
46 188132.89 1073.64 783.89 289.76 187843.14
47 187843.14 1073.64 782.68 290.96 187552.17
48 187552.17 1073.64 781.47 292.18 187260.00
49 187260.00 1073.64 780.25 293.39 186966.60
50 186966.60 1073.64 779.03 294.62 186671.99
51 186671.99 1073.64 777.80 295.84 186376.15
52 186376.15 1073.64 776.57 297.08 186079.07
53 186079.07 1073.64 775.33 298.31 185780.76
54 185780.76 1073.64 774.09 299.56 185481.20
55 185481.20 1073.64 772.84 300.80 185180.39
56 185180.39 1073.64 771.58 302.06 184878.34
57 184878.34 1073.64 770.33 303.32 184575.02
58 184575.02 1073.64 769.06 304.58 184270.44
59 184270.44 1073.64 767.79 305.85 183964.59
60 183964.59 1073.64 766.52 307.12 183657.46
61 183657.46 1073.64 765.24 308.40 183349.06
62 183349.06 1073.64 763.95 309.69 183039.37
63 183039.37 1073.64 762.66 310.98 182728.39
64 182728.39 1073.64 761.37 312.27 182416.12
65 182416.12 1073.64 760.07 313.58 182102.54
66 182102.54 1073.64 758.76 314.88 181787.66
67 181787.66 1073.64 757.45 316.19 181471.46
68 181471.46 1073.64 756.13 317.51 181153.95
69 181153.95 1073.64 754.81 318.84 180835.12
70 180835.12 1073.64 753.48 320.16 180514.95
71 180514.95 1073.64 752.15 321.50 180193.46
72 180193.46 1073.64 750.81 322.84 179870.62
73 179870.62 1073.64 749.46 324.18 179546.44
74 179546.44 1073.64 748.11 325.53 179220.90
75 179220.90 1073.64 746.75 326.89 178894.01
76 178894.01 1073.64 745.39 328.25 178565.76
77 178565.76 1073.64 744.02 329.62 178236.14
78 178236.14 1073.64 742.65 330.99 177905.15
79 177905.15 1073.64 741.27 332.37 177572.78
80 177572.78 1073.64 739.89 333.76 177239.02
81 177239.02 1073.64 738.50 335.15 176903.87
82 176903.87 1073.64 737.10 336.54 176567.33
83 176567.33 1073.64 735.70 337.95 176229.38
84 176229.38 1073.64 734.29 339.35 175890.03
85 175890.03 1073.64 732.88 340.77 175549.26
86 175549.26 1073.64 731.46 342.19 175207.07
87 175207.07 1073.64 730.03 343.61 174863.46
88 174863.46 1073.64 728.60 345.05 174518.41
89 174518.41 1073.64 727.16 346.48 174171.93
90 174171.93 1073.64 725.72 347.93 173824.00
91 173824.00 1073.64 724.27 349.38 173474.63
92 173474.63 1073.64 722.81 350.83 173123.80
93 173123.80 1073.64 721.35 352.29 172771.50
94 172771.50 1073.64 719.88 353.76 172417.74
95 172417.74 1073.64 718.41 355.24 172062.50
96 172062.50 1073.64 716.93 356.72 171705.79
97 171705.79 1073.64 715.44 358.20 171347.59
98 171347.59 1073.64 713.95 359.69 170987.89
99 170987.89 1073.64 712.45 361.19 170626.70
100 170626.70 1073.64 710.94 362.70 170264.00

1) Interest of month 100 = 710.94
2) Total Interest in 72 months = 57,172.93

Please Discuss in case of Doubt

Best of Luck. God Bless
Please Rate Well

jeff jeffy answered 1 year ago
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