Question

In: Finance

What must be the end-of-the-month mortgage payment amount required to repay a loan of $52000 in...

What must be the end-of-the-month mortgage payment amount required to repay a loan of $52000 in 25 years? Assume k = 0.12 with monthly compounding.

Round your final answer to 2 decimal places.

Solutions

Expert Solution

Monthly rate(M)= yearly rate/12= 1.00% Monthly payment= 5514.76
Month Beginning balance (A) Monthly payment Interest = M*A Principal paid Ending balance
1 525000.00 5514.76 5250.00 264.76 524735.24
2 524735.24 5514.76 5247.35 267.41 524467.83
3 524467.83 5514.76 5244.68 270.08 524197.74
4 524197.74 5514.76 5241.98 272.79 523924.96
5 523924.96 5514.76 5239.25 275.51 523649.44
6 523649.44 5514.76 5236.49 278.27 523371.17
7 523371.17 5514.76 5233.71 281.05 523090.12
8 523090.12 5514.76 5230.90 283.86 522806.26
9 522806.26 5514.76 5228.06 286.70 522519.56
10 522519.56 5514.76 5225.20 289.57 522229.99
11 522229.99 5514.76 5222.30 292.46 521937.53
12 521937.53 5514.76 5219.38 295.39 521642.14

.

.

.

292 47239.56 5514.76 472.40 5042.37 42197.19
293 42197.19 5514.76 421.97 5092.79 37104.40
294 37104.40 5514.76 371.04 5143.72 31960.68
295 31960.68 5514.76 319.61 5195.16 26765.52
296 26765.52 5514.76 267.66 5247.11 21518.42
297 21518.42 5514.76 215.18 5299.58 16218.84
298 16218.84 5514.76 162.19 5352.57 10866.26
299 10866.26 5514.76 108.66 5406.10 5460.16
300 5460.16 5514.76 54.60 5460.16 0.00
Where
Interest paid = Beginning balance * Monthly interest rate
Principal = Monthly payment – interest paid
Ending balance = beginning balance – principal paid
Beginning balance = previous Month ending balance

jeff jeffy answered 1 year ago
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