Question

Robert and pam get a $175,000 mortgage for 30 years at a fixed rate of 6.75%. their monthly payment amount is $1,135.05. what will the principal payment be when they make their fourth payment?

Answer 1

We will have to construct an amortization table as shown below to calculate the principal payment in the 4th payment

Month Payment Interest Principal Outstanding

0 175000.00

1 1135.05 984.38 150.68 174849.33

2 1135.05 983.53 151.52 174697.80

3 1135.05 982.68 152.37 174545.43

4 1135.05 981.82 153.23 174392.20

As per the above table. principal payment in the 4th payment = $153.23