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A couple has just purchased a home for $314,100.00. They will pay 20% down in cash,...

A couple has just purchased a home for $314,100.00. They will pay 20% down in cash, and finance the remaining balance. The mortgage broker has gotten them a mortgage rate of 3.72% APR with monthly compounding. The mortgage has a term of 30 years.

What is the size of the loan taken out by the couple?

A couple has just purchased a home for $313,200.00. They will pay 20% down in cash, and finance the remaining balance. The mortgage broker has gotten them a mortgage rate of 3.00% APR with monthly compounding. The mortgage has a term of 30 years.

How much interest is paid on the first payment?

A couple has just purchased a home for $313,200.00. They will pay 20% down in cash, and finance the remaining balance. The mortgage broker has gotten them a mortgage rate of 3.00% APR with monthly compounding. The mortgage has a term of 30 years.

How much interest is paid in the first year?

Expert Solution

1.Information provided:

Purchase price of the home= $314,100

Down payment= 0.20*$314,100= $62,820

Loan taken by the couple= Purchase price of the home - Down payment

= $314,100 - $62,820

= $251,280.

2. Information provided:

Purchase price of the home= $313,200

Down payment= 0.20*$313,200= $62,640

Mortgage= $313,200 - $62,640= $250,560

Time= 30 years

Interest rate= 3%

Interest on the first payment= Interest* Mortgage

= 0.03*$250,560

= $7,516. 80.

In case of any query, kindly comment on the solution.

jeff jeffy answered 1 year ago

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