Question

If I purchase a home for $150,000. I do a fixed 30-year mortgage at 6%. I have to put down 10%. What would be my annual payment? Answer: $6,456.72 Answer: $9,376.24 Answer: $9,712.72 Answer: $12,345.67

Answer 1

Annual payment $9,712.72

Step-by-step explanation:

Loan Amount = Cost of home - down payment

Loan amount = 150,000 - (10%× 150,000)= 135,000

Monthly payment = Loan Amount/Annuity factor

Annuity factor = (1 - (1+r)^(-n) )/r

r- monthly interest rate, n- number of months

Monthly interest rate = 0.5%

Number of months = 30× 12 = 360 months

Annuity factor = (1- (1+0.005)^(-360))/0.005= 166.7916144

Monthly payment = Loan Amount/Annuity factor

Monthly payment = 135,000/ 166.79=809.393209

Annual payment = Monthly payment × 12

Annual payment = 809.39 × 12 =9,712.718

Annual payment $9,712.72