If you borrowed $200,000 - what would your monthly loan payment be? Rate: 2.94 Time: 30...

If you borrowed $200,000 - what would your monthly loan payment be?

Rate: 2.94

Time: 30 years

If you borrowed $200,000 - what would your monthly loan payment be?

Rate: 7.85

Time: 30 years

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Expert Solution

Loan amount = Present value of future monthly payments = monthly payment * [1-(1+i)^-n]/i

i = interest rate per period

n = numbber of periods

monthly payment * [1-(1+0.0294/12)^-360]/(0.0294/12) = 200000

monthly payment = 836.75

monthly payment * [1-(1+0.0785/12)^-360]/(0.0785/12) = 200000

monthly payment = 1446.67

jeff jeffy answered 2 years ago

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