"I recently bought a new house for $200,000. There was a 20% down payment, and the...

"I recently bought a new house for $200,000. There was a 20% down payment, and the rest was financed at 4.8 percent APR with monthly compounding. Monthly payments starting from next month will be $1,248.66. How many years will it take the firm to pay off this debt?"

Please let me know values used in calculator or any formulas.

Expert Solution

In a financial calculator, calculator calculate for N, punch in:-

PV =200000*80% =160000

I/Y =4.8%/12 =0.40%

PMT = -1248.66

The answer will be 180 months, divide by 12, and the number of years are 15.00\

Or calculate in excel using the formula:-

=NPER(rate,pmt,pv)

=NPER(4.8%/12,-1248.66,200000*80%)/12

=15.00

jeff jeffy answered 2 years ago

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