You decide to buy a new home for $101000.00 at 7.5% interest rate. You feel that you can afford $800.00 for a mortgage payment. You make a down payment of $10000.00 How much will you still owe after making payments for one year. Show the mortgage payment schedule with the payment, amount to principal, Interest, Principal left, and equity in House.
To calculate the remaining amount owed after making payments for one year, we need to consider the mortgage payment schedule. Let's break down the steps:
Step 1: Calculate the loan amount:
Total cost of the new home = $101,000
Down payment = $10,000
Loan amount = Total cost - Down payment
Loan amount = $101,000 - $10,000
Loan amount = $91,000
Step 2: Calculate the monthly interest rate:
Annual interest rate = 7.5%
Monthly interest rate = Annual interest rate / 12
Monthly interest rate = 7.5% / 12
Monthly interest rate = 0.625%
Step 3: Calculate the monthly mortgage payment:
Loan amount = $91,000
Monthly interest rate = 0.625%
Number of monthly payments = 12 (for one year)
Mortgage payment can be calculated using the formula for a monthly mortgage payment:
Mortgage payment = (Loan amount * Monthly interest rate) / (1 - (1 + Monthly interest rate)^(-Number of monthly payments))
Mortgage payment = ($91,000 * 0.00625) / (1 - (1 + 0.00625)^(-12))
Mortgage payment ≈ $664.17
Step 4: Calculate the remaining amount owed after one year:
To find the remaining amount owed, we need to subtract the principal payment made throughout the year from the initial loan amount:
Remaining amount owed = Loan amount - (Principal payment for each month * Number of monthly payments)
Remaining amount owed = $91,000 - ($664.17 * 12)
Remaining amount owed ≈ $83,018.96
Now, let's create a mortgage payment schedule with the payment, amount to principal, interest, principal left, and equity in the house:
Month | Payment | Principal | Interest | Principal Left | Equity in House
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1 | $664.17 | $619.01 | $45.16 | $90,380.99 | $9,619.01
2 | $664.17 | $622.24 | $41.93 | $89,758.76 | $10,241.24
3 | $664.17 | $625.50 | $38.67 | $89,133.26 | $10,866.74
4 | $664.17 | $628.77 | $35.40 | $88,504.49 | $11,495.51
5 | $664.17 | $632.06 | $32.12 | $87,872.43 | $12,127.57
6 | $664.17 | $635.37 | $28.80 | $87,237.06 | $12,762.94
7 | $664.17 | $638.69 | $25.48 | $86,598.37 | $13,401.63
8 | $664.17 | $642.03 | $22.14 | $85,956.34 | $14,043.66
9 | $664.17 | $645.38 | $18.79 | $85,310.96 | $14,689.04
10 | $664.17 | $648.75 | $15.42 | $84,662.21 | $15,337.79
11 | $664.17 | $652.13 | $12.04 | $84,010.08 | $15,989.92
12 | $664.17 | $655.53 | $8.64 | $83,354.55 | $16,645.45
Please note that the interest and principal calculations may vary slightly due to rounding.