Question

PC to determine the regular payment amount, rounded to the nearest cent The cest of a home is financed with a $120 000 40-year fed-tate Use PMT- mortgage at 5% a. Find the monthly payments and the total interest for the loan b. Prepare a loan amortization schedule for the first three months of the mortgage The total interest for the loan is $ 157,747 20 (Use the answer from part a to find this answer. Round to the nearest cent as needed) b. Fill out the loan amortization schedule for the first three months of the mortgage below. Loan Balance Princi Payment Numbar Intorest Interest Use the answer from part a to find these answers Round to the nearest cent as neoded n tha prt elds and then cick check Answer

Answer 1

Answer a.

PMT = 120000 * (5%/12) / (1 - (1 + 5%/12) ^{- (12 *40)})

= $578.6359

Monthly Payment = $578.64

Total Interest of loan is = Monthly Installment * Number of months - Loan amount

= 578.64 * (40 *12) - 120000

= $157,747.20

Hence:

Monthly Payment = $578.64

Total Interest of loan is = $157,747.20

Answer b:

Interest Principal Loan Balance $78.64 $119,921.36 67 $78.97 $119,842.39 3$499.34S79.30 $119,.763.10 $500.00 $499.67 2

The above excel with 'show formula'

1 Payment Number Interest PrincipalLoan Balance 120000*5%/12 |:578.64-B21-120000-C2 :02,5%/12 |:578.64-B31-D2-C3 2 1 3 2 -D3*5%/12 |:578.64-B41-D3-C4 4 3 6