Homework Answers
Amount Borrowed = Purchase Price - Down payment
= $99,000 - $20,000 = $79,000
Monthly Payment = [Amount Borrowed * r] / [1 - (1 + r)-n]
= [$79,000 * (0.09/12)] / [1 - {1 + (0.09/12)}-(30*12)]
= $592.50 / 0.9321 = $635.65
The monthly deposit for property tax and insurance premium = ($1,908 + $1,068) / 12 = $248
So, Total monthly payment = Loan Monthly Payment + Monthly Deposit for property tax and insurance premium
= $635.65 + $248 = $883.65
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