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April 24, 2014

April 24, 2014

Posted by **need help :(** on Wednesday, October 3, 2012 at 3:43pm.

If they make equal monthly payments, how much is each payment?

- Math -
**Reiny**, Wednesday, October 3, 2012 at 3:54pmSo the balance to be mortgaged is 170 000

I am not sure if the rules for mortgage rates are the same in the US as they are in my Canada, but in general the interest period must coincide with the payment period, we have monthly payments but semi-annual compounding.

must find the equivalent monthly rate, let that rate be i

(1+i)^12 = 1.0225)^2

1+i = 1.0225^(1/6) = 1.00371532

i = .00371532

let the payment be P

P( 1 - 1.00371532^-180 )/.00371532 = 170 000

P = ....

I got $1296.88

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