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August 30, 2015

Homework Help: Maths Check

Posted by Jen on Thursday, March 13, 2008 at 10:04am.

Can Please someone check as per below I posted this yesterday and Drwls Answered and I post back the solution.

Thanks



Amortization of a $1000 Loan

Interest Monthly payment
rate
15yr 20yr 25yr 30yr
9.5% $10.45 $9.33 $8.73 $8.41
10.0% $10.75 $9.66 $9.09 $8.78
10.5% $11.06 $9.99 $9.45 $9.15
11.0% $11.37 $10.33 $9.81 $9.53
11.5% $11.69 $10.66 $10.16 $9.90
12.0% $12.01 $11.01 $10.53 $10.29
12.5% $12.33 $11.36 $10.90 $10.67
13.0% $12.66 $11.72 $11.28 $11.06

a. What is the monthly payment on a 25-year loan of $125,000 if the
annual interest is 9.5%
b. What are the total interest charges over the life of the loan?



For Further Reading


Maths - drwls, Wednesday, March 12, 2008 at 3:00pm
This looks like an exercise in Table reading, but the table is hard to read.

The 25-yr load entry in the 9.5% interest row is $8.73. That would be the monthly payment. 25 years is 300 months, so the total amount repaid would be $8.73 times that, or $2619.00

Of that amount, $1619.00 would be interest charges over the life of the loan. The rest is the return of the $1000 principal.



Maths - Jen, Wednesday, March 12, 2008 at 4:59pm
What is the monthly payment on a 25-year loan of $125,000 if the
annual interest is 9.5%

So for the 125,000 loan
monthly payment will be 8.73*125000/1000 = 1091.25

What are the total interest charges over the life of the loan?

1091.25*300 = 327375
Total Interest = 327375-12500 = 202375

Is this correct

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