posted by Shannon .
If you finance $50,000 of the purchase of your new home at 4.40% compounded monthly for 30 years, the monthly payment will be $250.38.
If instead your had a rate of 4.80% compounded monthly for 15 years, the monthly payment will be $390.21. How much do you pay in total for the $50,000 mortgage if you finance it for 30 years?
Total payment = ?
How much do you save (in total payments) if you finance for 15 years instead? ? dollars
$50000 @ 4.40% for 30 yrs.
Pt = $250.38/mo * 360mo = $90136.80
$50000 @ 4.80% for 15yrs.
Pt = $390.21/mo * 180mo = $70237.80.
Save: $90136.80 - 70237.80 = $19,899.