Question

Weston is buying a house for $215,000. He is financing $185,000 and obtained a 30-year, fixed-rate mortgage with a 6.525% interest rate. How much are his monthly payments?

Answer 1

Monthly payment = $117.24

Explanation:

Given : Weston is buying a house for $215,000. He is financing $185,000 and obtained a 30-year, fixed-rate mortgage with a 6.525% interest rate.

To find : The monthly payment

Solution : To find monthly payment the formula is

Monthly payment = Amount / Discount factor

Discount factor
`D=(1-(1+i)^(-n))/(i)`

Where, Amount(A)=$185,000 , Rate(r)= 6.525%=0.06525, Time(t)=30 year

`i=(0.06525)/(12)=0.0054375`

Time (in months)n=30 × 12 = 360

Put value in D we get,

`D=(1-(1+i)^(-n))/(i)`

`D=(1-(1+0.0054375)^(-360))/(0.0054375)`

`D=157.800128448`

Monthly payment
`M=(A)/(D)`

`M=(185000)/(157.800128448)`

`M=117.23691344`

Therefore, monthly payment = $117.24

Answer 2

For the answer to the question above asking How much are Weston's monthly payments if Weston is buying a house for $215,000. He is financing $185,000 and obtained a 30-year, fixed-rate mortgage with a 6.525% interest rate.?


PV 185,000, N 360, R 6.525% / 12 = .54375%. the answer is Pmt = 1,172.37