Shirley Trembley bought a house for $187,600. She put 20% down and obtained a mortgage loan...

Shirley Trembley bought a house for $187,600. She put 20% down and obtained a mortgage loan for the balance at 6 3/8% for 30 years.

a. Find the monthly payment.

b. Find the total interest paid

Please show your work

Solutions

Expert Solution

Given the amount of the loan required=p=187600*80%=150080 as 20% was paid down payment.

Given the loan rate r is 6.375%.=0.06375

Given the time is n=30 years.

Monthly payment = P × r × (1 + r)^n/((1 + r)^n - 1)

=150080*0.06375*(1+0.06375)^30/((1+0.06375)^30-1)

=936

Hence the total amount paid = 936*12*30=336960.

Hence interest paid=total amount paid-principal amount

=336960-150080=186880.

jeff jeffy answered 2 years ago

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