Question

The Murphys bought a 279,000 condominium. They made a down payment of 48,000 and took out a mortgage for the rest. Over the course of 15 years they made monthly payments of 1,949.32 on their mortgage until it was paid off.

(a) What was the total amount they ended up paying for the condominium (including the down payment and monthly payments)?
(b) How much interest did they pay on the mortgage?

Answer 1

The Murphys ended up paying a total of $398,877.60 for the condominium, including the down payment and monthly payments. They paid $167,877.60 in interest on the mortgage.

Step-by-step explanation:

To calculate the total amount the Murphys ended up paying for the condominium, we need to add the down payment and the total mortgage payments. The down payment was $48,000. The total mortgage amount is $279,000 - $48,000 = $231,000. Over 15 years, they made monthly payments of $1,949.32, so the total mortgage payments would be $1,949.32 x 12 months x 15 years = $350,877.60. Therefore, the total amount they ended up paying for the condominium is $48,000 + $350,877.60 = $398,877.60.

To calculate the amount of interest they paid on the mortgage, we need to subtract the original mortgage amount from the total amount they paid. The amount borrowed from the bank was $231,000. Therefore, the amount of interest paid on the mortgage is $398,877.60 - $231,000 = $167,877.60.