Question

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1. you have and a hasi yo love for $152 500 and han deaded tv chase it. You plan to put 15 percent dawn and finance the balance of the purchase using a 30-year martgage with a 5.116 percent nominal interest rate you make payments every month a compute the loan amunt and the montly payment. prende con amortization Schedule for the fast two months of the loan What is the total interest paid over the life of the loan?

Answer 1

House Value = $452,500

Down payment = 15%

Loan Amount = $ 452500(1-15%)

= $ 384625

Calculating the monthly Payment of Mortgage :-

EMI=P*r* (1+r) -1

where, P = Loan amount = $ 384625

r = Periodic interest Rate = 0.0576/12 = 0.0048

n = no of periods = 12*30 = 360

$EMI = 384625*0.0048*\frac{(1+0.0048)^{360}}{(1+0.0048)^{360}-1}$

$EMI = 1846.2*\frac{5.606160}{5.606160-1}$

EMI = $ 2247.01

- Amortization Schedule for the first two months are :-

Month	Principal	Interest	Payment	Outstanding Balance
1	401	1846	2247	384224
2	401	1844	2247	383821

- Total Interest Paid = ($2247.01*360)-$384625

= $ 424,298.6

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