You want to buy a house worth $3,230,000. You choose to take out a 30-year fixed...

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You want to buy a house worth $3,230,000. You choose to take out a 30-year fixed...

You want to buy a house worth $3,230,000. You choose to take out a 30-year fixed rate conforming mortgage, put a downpayment of $1.4 million and borrow the rest. The APR of the mortgage is 4.563% compounded monthly.

What is the Present Value of the overall amount of interest you have to pay?

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Answer 1

Answer #1

Amount financed = 3,230,000- 1,400,000 = 1830000

monthly rate = 4.563 /12 = .38025%

number of months = 30*12=360

Monthly payment = Amount financed /PVA .38025%,360

= 1830000/ 195.91113

= 9340.97 per month

Interest = Total payment made -amount financed

= [9340.97*360 ] -1830000

= 3362749-1830000

= 1532749

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Answer 2

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