Math

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The price of a home is $185,000. A down payment of 10% is required with 2 points at the time of closing. The home is financed over a 25 year period with a fixed rate of 4.5%. Find the monthly payment and total interest paid?

  • Math -

    % Financed = 100%-10% = 90%.

    Po = 0.9 * 185000=$166500=Amt. Financed

    P = Po(1+r)^n.

    r = (4.5%/12)/100% = 0.00375 = Monthly %
    rate expressed as a decimal.

    n = 12Comp./yr * 25Yrs = 300 Compounding
    periods.

    Plug the above values into the given Eq and get:

    P = $511,778.13.

    I = P-Po

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