finance

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shawn bought a home for $100000.he put 20% down and obtained a mortgage for 30 years at 51/2%.what is the total interest cost of the loan? i need the steps worked.

  • finance -

    % Loan = 100% - 20% = 80%.

    Amt of Loan = 0.8 * $100,000 = $80,000.

    Pt = Po*r*t / (1-(1+r)^-t),

    r = (5.5% / 12) / 100$ = 0.00458 = monthly % rate expressed as a decimal.

    t = 30yrs * 12mo/yr = 360mo.

    Pt=80000*0.004583333*360/(1-(1.004583333)^-360 = $163,523.23.

  • finance -

    Int. = 163,523.23 - 80,000 = $83,523.23

  • finance -

    well, the answer came out in ics as $104,480.00 but as i figured it 100,000/1000=100x5.68 so 5.68x360=204,480.00-100000.00=$104,480.00 that was i got but see is the 20% figured in that figure?

  • finance -

    $63,584.00is the correct answer.
    $80 x 5.68 = 454.40
    454.40 x 360 = 163,584.00
    163,584.00 - 100,000 = $63,584.00
    D.) $63,584.00

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