Question

What is the interest part of the 22nd monthly loan payment for a home mortgage loan of $175,000 at 6% interest for 30 years?

Answer 1

The interest part of the 22nd monthly loan payment for a home mortgage loan of $175,000 at 6% interest for 30 years is $875.

Step-by-step explanation:

To calculate the interest part of the 22nd monthly loan payment for a home mortgage loan, we need to determine the monthly payment amount and then subtract the principal portion. Let's start by calculating the monthly payment. We can use the formula for loan payment using the loan amount, interest rate, and loan term.

Loan amount: $175,000
Interest rate: 6% per year
Loan term: 30 years

Using the formula:

Monthly Payment = (Loan Amount * Monthly Interest Rate) / (1 - (1 + Monthly Interest Rate)^(-Number of Payments))

Let's break down the calculation:

1. Convert the annual interest rate to a monthly interest rate. 6% per year = 0.06 / 12 = 0.005 monthly interest rate.
2. Calculate the number of payments. 30 years * 12 months = 360 payments.
3. Plug the values into the formula: Monthly Payment = (175000 * 0.005) / (1 - (1 + 0.005)^(-360))
4. Calculate the interest part of the 22nd monthly payment by multiplying the loan balance (initial loan amount) by the monthly interest rate.

Plugging in the values, we get:

Monthly Payment = $1049.36
The interest part of the 22nd monthly payment = $175,000 * 0.005 = $875