Question

you just bought a house and have a $188,000 mortgage. the mortgage is for 15 years and has a nominal rate of 4.25%.on the 24th payment what will be the amount going to principal?

Answer 1

	Monthly rate(M)=	yearly rate/12=	0.35%	Monthly payment=	1414.28
Month	Beginning balance (A)	Monthly payment	Interest = M*A	Principal paid	Ending balance
1	188000.00	1414.28	665.83	748.45	187251.55
2	187251.55	1414.28	663.18	751.10	186500.45
3	186500.45	1414.28	660.52	753.76	185746.69
4	185746.69	1414.28	657.85	756.43	184990.26
5	184990.26	1414.28	655.17	759.11	184231.15
6	184231.15	1414.28	652.49	761.80	183469.35
7	183469.35	1414.28	649.79	764.50	182704.85
8	182704.85	1414.28	647.08	767.20	181937.65
9	181937.65	1414.28	644.36	769.92	181167.73
10	181167.73	1414.28	641.64	772.65	180395.08
11	180395.08	1414.28	638.90	775.38	179619.70
12	179619.70	1414.28	636.15	778.13	178841.57
13	178841.57	1414.28	633.40	780.89	178060.68
14	178060.68	1414.28	630.63	783.65	177277.03
15	177277.03	1414.28	627.86	786.43	176490.60
16	176490.60	1414.28	625.07	789.21	175701.39
17	175701.39	1414.28	622.28	792.01	174909.38
18	174909.38	1414.28	619.47	794.81	174114.57
19	174114.57	1414.28	616.66	797.63	173316.94
20	173316.94	1414.28	613.83	800.45	172516.49
21	172516.49	1414.28	611.00	803.29	171713.20
22	171713.20	1414.28	608.15	806.13	170907.07
23	170907.07	1414.28	605.30	808.99	170098.08
24	170098.08	1414.28	602.43	811.85	169286.23

Principal paid in 24th period =811.85

Where

Interest paid = Beginning balance * Monthly interest rate

Principal = Monthly payment – interest paid

Ending balance = beginning balance – principal paid

Beginning balance = previous Month ending balance