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24.07.2022 - 06:03

Please calculate the monthly mortgage and interest payment and show a clear and step-by-step calculation. Recently, you find a house with market value $500,000, interest rate 5.25%, and 20 years term

Question:

Please calculate the monthly mortgage and interest payment and show a clear and step-by-step calculation. Recently, you find a house with market value $500,000, interest rate 5.25%, and 20 years term loan. You also put $80,000 as a down payment. Please calculate your monthly payment.

Answers (1)

Augusta April 18, 2023 в 18:28

To calculate the monthly mortgage and interest payment, we can use the formula: M = P [ i(1 + i)^n ] / [ (1 + i)^n 1] where M is the monthly payment, P is the principal (the amount borrowed), i is the interest rate per month (annual interest rate divided by 12), and n is the number of months for repayment (term of loan multiplied by 12). Using the given values, we can plug them into the formula: P = 500,000 - 80,000 = 420,000 i = 0.0525 / 12 = 0.004375 n = 20 x 12 = 240 M = 420,000 [ 0.004375 (1 + 0.004375)^240 ] / [ (1 + 0.004375)^240 1] M = 420,000 [ 0.004375 (1.004375)^240 ] / [ (1.004375)^240 1] M = 2,720.57 Therefore, the monthly mortgage and interest payment is $2,720.57 for a house with a market value of $500,000, an interest rate of 5.25%, and a 20-year term loan, with a down payment of $80,000.

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