Final answer:
To find the total loan amount for buying a house with a principal amount of $175,000 and a 10% down payment, you subtract the down payment from the principal amount. The down payment is $17,500 (10% of $175,000), so the loan amount is $157,500.
Step-by-step explanation:
The question asks us to calculate the total amount of the loan after considering a down payment for buying a house that costs $175,000 at a fixed interest rate of 5% for a 30-year term. The down payment amount given is 10%, which means the down payment would be 10% of $175,000. To find the total loan amount, we first need to subtract the down payment from the principal amount.
Down Payment Calculation:
Down Payment = 10% of $175,000
Down Payment = 0.1 × $175,000
Down Payment = $17,500
Now, subtract the down payment from the principal amount to get the loan amount:
Loan Amount = $175,000 - $17,500
Loan Amount = $157,500
This is the amount that needs to be financed through the mortgage. Please note that property taxes are typically paid separately and are not added to the loan amount itself.