When Gustavo and Serrana bought their home, they had a 5.4% loan with monthly payments of...

When Gustavo and Serrana bought their home, they had a 5.4% loan with monthly payments of $870.60 for 30 years. After making 78 monthly payments, they plan to refinance for an amount that includes an additional $35,000 to remodel their kitchen. They can refinance at 4.7% compounded monthly for 25 years with refinancing costs of $625 included with the amount refinanced. (a) Find the amount refinanced. (Round your answer to the nearest cent.) $ (b) Find their new monthly payment. (Round your answer to the nearest cent.) $ (c) How long will it take to pay off this new loan if they pay $1200 each month? (Round your answer up to the next whole number.) payments

Solutions

Expert Solution

	Original loan amount	$155,040.47

	Principal paid off in 78 payments	-16114.77

	Balance loan	$138,925.71
a	Amount refinanced	$174,550.71

b	New Monthly payment	$990.13

c	Number of months at $1200 payment Rounded off to	215.73 216

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jeff jeffy answered 1 year ago

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