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Imagine you have $50,000 for a house down payment for a $250,000 home. What are the...

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Finance

Imagine you have $50,000 for a house down payment for a $250,000home. What are the monthly payments on a 30-year, fixed-ratemortgage of $200,000 assuming your mortgage carries a 5% interestrate. If you pay off the mortgage after thirty years, how much willyou have paid in interest beyond the price of the house itself?

Answer & Explanation Solved by verified expert
3.9 Ratings (721 Votes)

Amount financed : Cost -down payment

                      = 250000-50000

                      = $ 200000

Part 1 )monthly rate : 5/12 = .41667%

Number of months = 30 *12= 360

Monthly payment = Amount financed /PVA.41667%,360

                          = 200000/ 186.28045

                          = 1073.65 per month

**Find present value annuity factor using financial calculator where i= .41667% ,n= 360 ,PMT =1

part 2)Total amount paid over 360 months : 360 *1073.65

                                                                 = $ 386514

Interest paid = Total amount paid - amount financed

                      = 386514 -200000

                      = $ 186514
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Imagine you have $50,000 for a house down payment for a $250,000home. What are the monthly payments on a 30-year, fixed-ratemortgage of $200,000 assuming your mortgage carries a 5% interestrate. If you pay off the mortgage after thirty years, how much willyou have paid in interest beyond the price of the house itself?

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