Wednesday
April 16, 2014

Homework Help: Finance

Posted by Antoinette on Sunday, March 18, 2007 at 11:49pm.

You take out a 30-year $100,000 mortgage loan with an APR of 6 percent and monthly payments. In 12 years you decide to sell your house and pay off the mortgage. What is the principal balance on the loan?

I am working this on the assumption that your monthly rate is .005.

First we find our monthly payment:

100000= paym[1-(1.005)^-360]/.005

paym= 599.55

Now finding the amount of 144 of those payments
=599.55((1.005^144)-1)/.005
=125,995.64

Finding the value of our debt after 144 periods if no payments had been made
=100000(1.005^144
=205,075.08

So the outstanding balance after 12 years
= 205075.08-125995.64
=79,079.44

I hope you are familiar with the formulas I was using.

Answer this Question

First Name:
School Subject:
Answer:

Related Questions

Finance - You take out a 30-year $100,000 mortgage loan with an APR of 6 percent...
Finance - You take out a 30 year $100000 mortgage loan with an apr of 6% and ...
finance - You take out a 25-year $210,000 mortgage loan with an APR of 12% and ...
finance - You borrow $185,000 to buy a house. The mortgage rate is 6.5 percent ...
Maths - Mortgage company lets you pay a point (1% of total amount of loan)to ...
Finance - You have just purchased a new warehouse. To finance the purchase, you'...
finance - You take out a 30- yr mortgage loan, purchase price is $120,000 put $...
public finance - Your annual income is $50,000. You want to take out a mortgage ...
SMU - You have just purchased a new warehouse. To finance the purchase, you've ...
Math - Suppose you wnat to purchase a house for 650,000. Hoe much of the loan ...

Search
Members