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In: Finance

Consider a 30-year, traditional mortgage on a $200,000 property. With 30% down payment and a 4%...

Consider a 30-year, traditional mortgage on a $200,000 property. With 30% down payment and a 4% APR. Mortgage payments are made monthly. What is the 214th payment?

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Expert Solution

EMI = Loan Amount / PAVf (r%, n)

PVAF = Sum (PVF(r%, n))

Loan = Purchase Price * ( 1 - Down Payment % )

= $ 200000 * (1 - 0.3)

= $ 200000 * 0.7

= $ 140000

= $ 140,000 / PVAF ( 0.3333%, 360 )

= $ 140000 / 209.4612

= $ 668.38

Loan Amortization:

Month Opening Bal Instalment Int Principal Repay Closing Balance
209 $    79,602.54 $ 668.38 $ 265.34 $ 403.04 $    79,199.50
210 $    79,199.50 $ 668.38 $ 264.00 $ 404.38 $    78,795.11
211 $    78,795.11 $ 668.38 $ 262.65 $ 405.73 $    78,389.38
212 $    78,389.38 $ 668.38 $ 261.30 $ 407.08 $    77,982.30
213 $    77,982.30 $ 668.38 $ 259.94 $ 408.44 $    77,573.86
214 $    77,573.86 $ 668.38 $ 258.58 $ 409.80 $    77,164.06
215 $    77,164.06 $ 668.38 $ 257.21 $ 411.17 $    76,752.89

From Above One, 214th Payment:

EMI = 668.38

Int = 258.58

Principla Repay = 409.80

Outstanding Bal = 77164.06


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