ind the monthly payment for the loan. (Round your answer to the nearest cent.)
Finance $450,000 for a warehouse with a 7.50% 30-year loan
Thank you for your help.
Just look up the formula for monthly payment of loan amortization, and plug in your numbers.
To find the monthly payment for the loan of $450,000 with a 7.50% interest rate and a 30-year term, you can use the formula for calculating the monthly payment for a fixed-rate mortgage:
M = P [ i(1 + i)^n ] / [ (1 + i)^n - 1 ]
Where:
M = Monthly payment
P = Principal amount (loan amount)
i = Monthly interest rate (annual interest rate divided by 12)
n = Number of monthly payments (loan term in years multiplied by 12)
First, convert the annual interest rate to a monthly interest rate:
i = 7.50% / 100 / 12 = 0.0625
Next, convert the loan term in years to the number of monthly payments:
n = 30 years * 12 months/year = 360 months
Now, substitute the values into the formula and calculate the monthly payment:
M = 450,000 * [ 0.0625(1 + 0.0625)^360 ] / [ (1 + 0.0625)^360 - 1 ]
Using a calculator or spreadsheet software, calculate the value inside the square brackets first:
(1 + 0.0625)^360 = 21.697092
Now, calculate the numerator:
450,000 * 0.0625 * 21.697092 = 685,875.09
Lastly, calculate the denominator:
(1 + 0.0625)^360 - 1 = 21.697092 - 1 = 20.697092
Finally, divide the numerator by the denominator to find the monthly payment:
M = 685,875.09 / 20.697092 = $33,189.72 (rounded to the nearest cent)
Therefore, the monthly payment for the loan is approximately $33,189.72.