Question

You take out a 30-year $130,000 mortgage loan with an apr of 6 nd monthly payments. in 15 years you decide to sell your house and pay off the mortgage. what is the principal balance on the loan?

Answer 1

The remaining principal balance on a $130,000 mortgage with a 6% APR after 15 years of monthly payments of $1,798.65 requires an amortization calculation, which involves considering interest rates, total loan amount, loan term, and payments made.

Step-by-step explanation:

The question pertains to determining the remaining principal balance of a mortgage after making payments for 15 years. The original mortgage is a 30-year loan for $130,000 with an annual percentage rate (APR) of 6%. Considering the given monthly repayment amount ($1,798.65) and the total amount paid after 30 years ($647,514.57), we need to calculate what portion of the loan will still be due after 15 years of payments.

Typically, this type of calculation would involve amortization formulas or tables that take into consideration the interest rate, the total loan amount, the term of the loan, and the payments made to date. However, to obtain an exact figure for the remaining balance after 15 years, one would use either a financial calculator or a specialized computer program that can handle such amortization calculations. Additionally, if payments were increased ($1,948.54, as per the example), it is expected that the loan would be paid off faster, and the interest paid over the life of the loan would be reduced.

Answer 2

To calculate the remaining balance of a $130,000 mortgage at an APR of 6% after 15 years, one would need to use an amortization formula or tool, but typically, the principal paid down is less than the interest in the first half of the mortgage.

Step-by-step explanation:

To determine the principal balance on a 30-year $130,000 mortgage with an APR of 6% after 15 years, you would typically use an amortization schedule or a financial calculator. The formula for the remaining balance on a mortgage is not provided, but it involves calculating the present value of the remaining payments. The monthly payment provided, $1,798.65, implies that we are looking for the remaining balance after half of the term has passed.

In terms of calculations, it's clear that the overall interest paid is significant, often resulting in a total repayment of more than twice the original loan amount. For example, a $1,000,000 loan may end up costing over $2.1 million over 30 years. As for Joanna's situation, understanding how much she can afford and the final cost of a loan after 30 years would require using a present value formula with her annual payment limit and the given interest rate.