Algebra

[pic] 12.1 1. The occlusionic mortgage would be such that the present guess of the mortgage meter is equal to the add amount. To find the periodic mortgage amount, we use the PV of annuity formula since periodical pay is the annuity and the PV is the loan amount. The PV of annuity is stipulation as PV = PMT [(1 - (1 / (1 + i)^n)) / i] Where PV = loan amount PMT = monthly mortgage payment i = monthly interest rate n = monthly periods Using the to a higher place formula we calculate the monthly payments for the given rates and loan amount and time period a. 6.25%, 15 year, $150,000 150,000 = PMT [(1-(1/(1+6.25%/12)^(15X12))/6.25%/12] PMT = $1,286.13 come amount paid = 1,286.13 X 15 years X 12 months = 231,503.40 Loan amount = $150,000 Interest paid = 231,503.40-150,000 = $81,503.4 b. 6.25%, 15 years, 175,000 175,000 = PMT [(1-(1/(1+6.25%/12)^(15X12))/6.25%/12] PMT = $1,500.49 fuse amount paid = 1,500.49 X 15 x 12 =270,088.20 Loan amount = 175,000 I nterest paid = 270,088.20 175,000 = 95,088.20 Doing the comparable federal agency we are able to fill the table Monthly recompense is | |6.25% |6.50% |7% | |Amount |15 |20 |30 | | 150,000 |$1,286.13 |$1,118.36 |$997.95 | | 175,000 |$1,500.49 |$1,304.75 |$1,164.28 | | 200,000 |$1,714.85 |$1,491.15 |$1,330.

60 | Total interest paid is | ! |6.25% |6.50% |7% | |Amount |15 |20 |30 | | 150,000 |$81,504.17 |$118,406.33 |$209,263.35 | | 175,000 |$95,088.20 |$138,140.72 |$244,140.57 | | 200,000 |$108,672.23 |$157,875.11 |$279,017.80 | 2. Loan amount = 175,000-20,000=155,000. The rate is 6.75% and period is 25 years. Using the PV of annuity formula...If you want to get a intact essay, order it on our website: OrderCustomPaper.com

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