Question

Problem #1

Tremaine just graduated from school and he wants a one bedroom townhouse in a new development downtown; average cost is $345,000
Is preapproved for a 6.33% interest rate on a 30-year fixed mortgage
Has saved $15,000 for a down payment

Questions :
1- What will Tremaine’s monthly payment be? (principal + interest)

2-How much total interest will he pay over the course of the mortgage? (Hint: Click on the Amortization tab)

3-If Tremaine waited until he had $30,000 saved for a down payment, what will his monthly payment be (principal + interest)?



4-How much total interest will he pay over the course of the mortgage?


5 - How much money will he save by paying an extra $15,000 upfront?


6 - Which option would save Tremaine the most money over the life of the loan?
$15,000 down payment
$30,000 down payment

Answer 1

Answer: 1. Lenders multiply your outstanding balance by your annual interest rate, divided by 12, to determine how much interest you pay each month.

2. Monthly loan payment is calculated using PMT function in Excel : rate = 4.38% / 12 (converting annual rate into monthly rate) nper = 30*12 (30 year loan. 2. How much total interest will he pay over the course of the mortgage

3. Therefore, tremaine's monthly payment on the loan will be $574.52. Missing information includes " Wants a one bedroom townhouse in a trendy new. His monthly payment will be $574.52Here, we will use the PMT function

4.With this 'how much interest will I pay' calculator, you'll quickly determine how much interest you'll pay on your mortgage, car loans, & much more. For example, if you borrow $200,000 at a 4% interest rate, your very first monthly payment will include $666.67 in interest and $288.16 toward the principle.

5.The amount of money he will save by paying an extra $15,000 upfront is $11,974.80. Loan = Cost - Down payment. Loan = $145,000 - $15,000. How much money did he save by paying an extra $15,000 upfront?

6.Our down payment calculator helps estimate your mortgage based on how much money you use as a down payment on a house. Learn how much you should put down Tremaine Use Bankrate's auto down payment calculator to estimate how much money you can save on your monthly payment by putting down money using cash, a trade-in the amount of upfront cash needed, down payment percentage, or an affordable home price based on 3 potential

Explanation: