Donna wants to buy a house for $810,000.00. She makes a 20% down payment and borrows the rest by getting a 20-year mortgage. Her monthly mortgage payment is $4,401.00. a) What is the principal of her mortgage? Principal $ b) What is the total she will pay on the loan? Total paid c) How much interest will she pay over the life of her loan?

Donna wants to buy a house for $810,000.00. She makes a 20% down payment and borrows the rest by getting a 20-year mortgage. Her monthly mortgage payment is $4,401.00. a) What is the principal of her mortgage? Principal $ b) What is the total she will pay on the loan? Total paid c) How much interest will she pay over the life of her loan?

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 25PROB

See similar textbooks

Similar questions

Donna wants to buy a house for $900,000.00. She makes a 15% down payment and borrows the rest by getting a 30-year mortgage. Her monthly mortgage payment is $3,803.75. What is the principal of her mortgage? What is the total she will pay on the loan?
2. Assume Josephine purchases a home for $180,000 and has a 20% down payment. If she finances the purchase with a 30 year mortgage with a 4% interest rate……what is her monthly payment? If she pays the mortgage through the entire term with no early payment, how much interest will she pay over the life of the loan?
Sonia buys a house for $250,000. she makes a down payment of 15% of the purchase price and takes a 30-year mortgage for the balance. a) what is your down payment b) what is your mortgage amount c0 what is the total interest charged over the life loan if your monthly payment is 1,200 dollars
Gabby is planning to buy a home. She has some money for a down payment already saved. She sees a home she would like and calculates that she would need to borrow $210,000 from a bank for a 30-year period. The APR is 7.2%. What will be her total interest for the 30 years? How much total interest will Gabby pay with a 15 year mortgage? Step 1) What is the monthly payment? Step 2) What are the total payments ($) for the entirety of the loan? Step 3) What is the total interest?
1.Maria takes out a 30-year mortgage at 4.5% to buy a house that costs $250,000. She must have a down payment of 2% of the purchase price. (a) How much does she need for the down payment? How much money does Maria need to borrow? (b) What will Maria's monthly mortgage payments be? Be mindful of how much she actually needs to borrow! (c) How much interest will Maria pay over 30 years? (d) Maria could instead choose a 15-year mortgage at 4.5%. Discuss the pros and cons of this choice.
Gabby is planning to buy a home. She has some money for a down payment already saved. She sees a home she would like and calculates that she would need to borrow $210,000 from a bank for a 30-year period. The APR is 7.2%. What will be her total interest for the 30 years? Step 1) What is the monthly payment? Step 2) What are the total payments ($) for the entirety of the loan? Step 3) What is the total interest?
(6) Marian has just purchased a house. She has a $400,000, 20-year mortgage with interest at an annual rate of 4.5% a year, compounded continuously. Assuming Marian pays her mortgage continuously with a fixed amount: (a) How much is her monthly payment? (b) If she pays an extra $400 each month, how soon can she pay off the mortgage? (c) How much money can Marian save by paying an extra $400 each month?
Part B) Suppose karen has $2000 each month that she can allocate between mortgage payments and retirement. That is, if she pays $1200 toward her mortgage, then she can put the remaining $800 into her retirement account each month. She plans to retire in 30 years. If she goes with the 15 year home loan, then the first 15 years she will have to split the $2000 between mortgage and retirement, but then the last 15 years she can put all $2000 into her retirement account. If she goes with the 20 year home loan, then the first 20 years she will have to split the $2000 between mortgage and retirement, but then the last 10 years she can put all $2000 into her retirement account. If she goes with the 30 year home loan, then she will split the $2000 between mortgage and retirement for all 30 years. Her best retirement option offers her a nominal rate of 5.5%, compounded monthly. Calculate the value of her retirement account in 30 years under each of the 3 plans. Which plan will give her the…
A couple who wants to purchase a home with a price of $340,000 has $100,000 for a down payment. If they can get a 25-year mortgage at 6% per year on the unpaid balance, find each of the following. (a) What will be their monthly payments? (b) What is the total amount they will pay before they own the house outright? (c) How much interest will they pay over the life of the loan? (a) Their monthly payments would be approximately $ (Do not round until the final answer. Then round to the nearest hundredth as needed.) (b) They will pay a total amount of approximately $ before they own the house outright. (Use the answer from part a to find this answer. Round to the nearest hundredth as needed.) (c) The total interest is approximately $ (Use the answer from part b to find this answer. Round to the nearest hundredth as needed.)
1) How much total interest will Ashley pay over 10 years if she only makes minimum payments Scenario: Ashley decides to pay 500 total to her student loans each month. She continues the minimum payment on the loan with the lower interest rate and puts the rest of the $500 towards the higher interest rate loan until it's paid off. Then she puts all $500 towards the lower interest rate loan until it is paid off. a) How much total interest will Ashley pay in this scenario? b) How much does she save by increasing her payments in this way
Jake just got a $96000 mortgage in order to buy a new home, and he was able to get a 30 year loan at 5.5% interest. Answer the following questions about Jake's loan. (Round your answers to the nearest cent.) What is Jake's monthly payment? $nothing How will Jake pay in total over the lifetime of the loan? $nothing How much interest will Jake pay over the lifetime of the loan? $
1. Maria takes out a 30-year fixed rate mortgage at 5% to buy a house that costs $450,000. To avoid paying mortgage insurance, she needs to put 20% of the purchase price as a down payment. (a) How much does she need for the down payment? How much money does Maria need to borrow? (b) How much will Maria's monthly mortgage payments be? (c) How much interest will Maria pay over 30 years? What percentage of the total cost of the mortgage is the interest? (d) Maria could instead choose a 15-year fixed rate mortgage at 4.5%. Calculate her monthly payments and total interest paid with this option and compare these results to the answers you gave in (b). Assume she is still putting 20% down. (e) Calculate the future value of the two options below. Which option below gives her more wealth in 30 years? Option 1: Get the 30-year mortgage at 5% APR. Invest the difference in the mortgage payments in a stock index fund that has an average APR of 7.5%. Option 2: Get the 15-year mortgage at 4.5%.…