Question
In: Finance
You are buying a new house on a 30-year, 6.2% mortgage loan of $230,000. A. How...
You are buying a new house on a 30-year, 6.2% mortgage loan of $230,000.
A. How much will your monthly payments be?
B. How much will go toward principal in the 55th month? How much will go toward interest in the 55th month? What will be the balance after 55 months?
C. How much interest will you pay in total over the 30 years?
D. If you do a 15-year loan instead of a 30-year one, how much will you save in total interest?
Solutions
Expert Solution
| A. | Monthly Payment | =-pmt(rate,nper,pv,fv) | |||||||
| = $ 1,408.68 | |||||||||
| Where, | |||||||||
| rate | = | 6.2%/12 | = | 0.005166667 | |||||
| nper | = | 30*12 | = | 360 | |||||
| pv | = | $ 2,30,000 | |||||||
| fv | = | 0 | |||||||
| B. | Principal repaid in 55th Payment | $ 291.04 | |||||||
| Interest repaid in 55th Payment | $ 1,117.63 | ||||||||
| Balance after 55th Payment | $ 2,16,025.16 | ||||||||
| Working: | |||||||||
| Balance after 54th Payment | =pv(rate,nper,pmt,fv) | Where, | |||||||
| $ 2,16,316.20 | rate | = | 0.00516667 | ||||||
| nper | = | 360-54 | = | 306 | |||||
| pmt | = | $ -1,408.68 | |||||||
| fv | = | 0 | |||||||
| Month | Beginning Loan | Interest | Payment | Principal Repaid | Ending Loan | ||||
| a | b=a*6.2%*1/12 | c | d=c-b | e=a-d | |||||
| 55 | $ 2,16,316.20 | $ 1,117.63 | $ 1,408.68 | $ 291.04 | $ 2,16,025.16 | ||||
| C. | Interest Paid | $ 2,77,124.31 | |||||||
| Working: | |||||||||
| Total repayment | $ 1,408.68 | * | 360 | = | $ 5,07,124.31 | ||||
| Loan amount | $ 2,30,000.00 | ||||||||
| Interest | $ 2,77,124.31 | ||||||||
| D. | Saving in Interest | $ 1,53,278.45 | |||||||
| Working: | |||||||||
| Monthly Payment | =-pmt(rate,nper,pv,fv) | ||||||||
| = $ 1,965.81 | |||||||||
| Where, | |||||||||
| rate | = | 6.2%/12 | = | 0.0051667 | |||||
| nper | = | 15*12 | = | 180 | |||||
| pv | = | $ 2,30,000 | |||||||
| fv | = | 0 | |||||||
| Total repayment | = | $ 1,965.81 | * | 180 | = | $ 3,53,845.86 | |||
| Loan amount | $ 2,30,000.00 | ||||||||
 jeff jeffy answered 1 year agoRelated SolutionsYou are buying a new house on a 30-year, 5.2% mortgage loan of $230,000. A) How...You are buying a new house on a 30-year, 5.2% mortgage loan of
$230,000.
A) How much will your monthly payments be?
B) How much will go toward principal in the 75th month? How much
will go toward interest in the 75th month? What will be the balance
after 75 months?
C) How much interest will you pay in total over the 30
years?
D) If you do a 15-year loan instead of a 30-year one, how much
will you...
You plan to purchase a house for $230,000 using a 30-year mortgage obtained from your local...
You plan to purchase a house for $230,000 using a 30-year
mortgage obtained from your local bank. You will make a down
payment of 25 percent of the purchase price. You will not pay off
the mortgage early. Assume the homeowner will remain in the house
for the full term and ignore taxes in your analysis.
a.
Your bank offers you the following two options for
payment:
Which option should you choose?
Option 1: Mortgage rate of 5.90 percent and...
Loan 3: 15-year versus 30-year mortgage Amortize a mortgage for a $225,000 house with a 20%...Loan 3: 15-year versus 30-year mortgage
Amortize a mortgage for a $225,000 house with a 20% down payment
for both a 15-year mortgage at 3.625% and a 30-year mortgage at
4.125%.
15-year mortgage monthly payment?
What is the total interest cost over the life of the 15-year
loan?
30-year mortgage monthly payment?
What is the total interest cost over the life of the 30-year
loan?
Difference in interest costs between a 15-year and a 30-year
mortgage?
You are buying a house and trying to decide how to structure a the loan.You are buying a house and trying to decide how to structure a the loan. You can borrow $120,000 at a 4.5 percent rate for 30 years with monthly payments, or you can borrow $120,000 at a 3.75 rate for 20 years with monthly payments. what should you consider when making this decision?
16. John is buying a house for $1,000,000. He can get a 30-year loan on 80%...16. John is buying a house for $1,000,000. He can get a 30-year
loan on 80% of the purchase price at 7.25% with monthly payments,
or he can get a 15-year monthly payment loan at 6.5% with the 20%
downpayment.
a. What would his payments be for each
loan? [$5457.41; $6968.86]
b. How much interest is paid over the
life of each loan? [$1,164,667.60; $454,394.80]
You are buying a house and trying to decide how to structure the loan. You can...You are buying a house and trying to decide how to structure the
loan. You can borrow $120,000 at a 4.5% rate for 30 years with
monthly payments, or you can borrow $120,000 at a 3.75% rate for 20
years with monthly payments. What should you consider when making
this decision?
On June 1, you borrowed $230,000 to buy a house. The mortgage rate is 8 percent....On June 1, you borrowed $230,000 to buy a house. The mortgage
rate is 8 percent. The loan is to be repaid in equal monthly
payments over 20 years. The first payment is due on July 1. Assume
that each month is equal to 1/12 of a year. How much of the second
payment (on August 1) applies to the principal balance? $ How much
of the second payment (on August 1) is interest? $ How much of the
third...
Suppose you are buying a house and have taken out a mortgage for $250,000. The mortgage...Suppose you are buying a house and have taken out a mortgage for
$250,000. The mortgage is a 30 year fixed rate mortgage with an APR
of 5.25%. What is your monthly mortgage payment?
Construct a loan amortization table in Excel for mortgage loan
in the previous problem. You should do the problem in Excel using
monthly payments and you must submit the spreadsheet with
formulas.
Suppose you bought a new home for $230,000 using a 22-year mortgage with semiannual payments of...Suppose you bought a new home for $230,000 using a 22-year
mortgage with semiannual payments of $10,236.491. The annual
interest rate of the mortgage is 6.9%. Right after the first 4
years (18 years left), approximately how much money have you paid
in interest and how much in principal?
Group of answer choices
Interest: $81,891.93; Principal: $209,204.62
Interest: $435,917.86; Principal: $55,433.72
Interest: $61,096.55; Principal: $20,795.38
Interest: $20,795.38; Principal: $10,236.49
You are buying a house for $350,000 with a 20% down payment. You use a 30-year...You are buying a house for $350,000 with a 20% down payment. You
use a 30-year monthly amortized mortgage at a 5.75% nominal
interest rate. Monthly payments are &1,634. What is the
estimated payoff on the mortgage after you have paid for 10
years?
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
ADVERTISEMENT
|