Question
In: Finance
Imagine you have $50,000 for a house down payment for a $250,000 home. What are the...
Imagine you have $50,000 for a house down payment for a $250,000 home. What are the monthly payments on a 30-year, fixed-rate mortgage of $200,000 assuming your mortgage carries a 5% interest rate. If you pay off the mortgage after thirty years, how much will you have paid in interest beyond the price of the house itself?
Solutions
Expert Solution
Amount financed : Cost -down payment
= 250000-50000
= $ 200000
Part 1 )monthly rate : 5/12 = .41667%
Number of months = 30 *12= 360
Monthly payment = Amount financed /PVA.41667%,360
= 200000/ 186.28045
= 1073.65 per month
**Find present value annuity factor using financial calculator where i= .41667% ,n= 360 ,PMT =1
part 2)Total amount paid over 360 months : 360 *1073.65
= $ 386514
Interest paid = Total amount paid - amount financed
= 386514 -200000
= $ 186514
jeff jeffy answered 1 year agoRelated Solutions
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