+41 ,You buy a house at $180,000 and pay 20% down, taking out a 30 year mortgage at 5.5% APR
How much would resulting morgage be?
180000*.20=36000
180000-36000=144000
144000*0.055(1*0.055)^360/((1.055)^360-1)=$792 Monthly Payment
792*12=9504*30=$285,120.00 total paid ?
How much interest over the loan?
285120-144000=141120.00?
How much equity would you have after 10 years?
Instructor has not shown us how to get equity? SO I have no clue
Suppose you put an extra $100 a month toward the payments. HOw much faster will you pay off the loan?
I guess 10 years faster? just guessing at this point
Referencing part d, how much interest will you save by paying the $100/month?
You made a mistake in calculating your monthly payment. This is the formula you would use to calculate the monthly payment:
N=30*12; R=0.055/12;PV=144000; PMT=PV*R*((1 + R)^N) / ((1 + R)^(N) - 1)
MORTGAGE PMT =$ 817.62 -monthly
$817.62 x 360 months ==$294,343.20 - principal + interest paid over 30 years.
$294,343.20 - $144,000 principal==$150,343.20 - total interest paid over 30 years.
Balance of the mortgage after 10 years==$118,859.03
House equity after 10 years ==180,000 - $118,859.03 ==$61,140.97
If the mortgage payment was: $817.62 + $100==$917.62 - the mortgage would be paid off in 278 months==23 years and 2 months. So, the mortgage would be paid off some 82 months earlier, or about 6 years and 10 months earlier.
