Given the following the data:
home loan amount 340,000
interest 4.6%
loan term in years : 20 yrs
1)Calculate the monthly payment
2)Calculate the present value given 12 years
3) If the annual increase in home value is 7% yearly, calculate the value of the home at the time of the present value.
thank you
I know monthly payment is 2,169.33
stuck on present value after 12 years
I agree with your monthly payment, mine was 2169.40 , no big deal
2. The wording is confusing. Do you want the outstanding balance of the loan after 12 years? Seems like the only logical thing to find
balance = 340000(1.003833333)^144 - 2169.33(1.003833333^144 - 1)/.0083333333
=
3. value of home after 12 years = 340000(1.07)^12 = ????
(you would still have the liability of your loan against that, don't know if you would want to subtract that)
3 yes, value to owner is cash he has to buy new house = value - what he owes bank.
To calculate the present value after 12 years, we need to determine the remaining amount on the loan after 12 years.
Let's calculate the remaining loan amount after 12 years using the following formula:
Present Value = Future Value / (1 + interest rate)^n
Where:
Future Value = Initial loan amount
Interest rate = Annual interest rate / 12 (to convert it to a monthly rate)
n = Number of months
Given:
Initial loan amount = $340,000
Annual interest rate = 4.6%
Loan term = 20 years (or 240 months)
Number of months after 12 years = 12 * 12 = 144 months
1) Calculate the monthly payment:
To calculate the monthly payment, we can use the formula for a fixed-rate loan:
Monthly Payment = (Principal * Monthly Interest Rate) / (1 - (1 + Monthly Interest Rate)^(-n))
Where:
Principal = Initial loan amount
Monthly Interest Rate = Annual interest rate / 12 (to convert it to a monthly rate)
n = Number of months
Using the given values:
Principal = $340,000
Monthly Interest Rate = 4.6% / 12 = 0.0038333
n = 20 * 12 = 240
Plugging in these values into the formula for the monthly payment:
Monthly Payment = (340,000 * 0.0038333) / (1 - (1 + 0.0038333)^(-240))
Monthly Payment = 2,169.33 (rounded to 2 decimal places)
2) Calculate the present value after 12 years:
Present Value = Future Value / (1 + interest rate)^n
Using the given values:
Future Value = Remaining loan amount after 12 years
Interest rate = Annual interest rate / 12 (to convert it to a monthly rate)
n = Number of months after 12 years = 144
Substituting the values into the formula:
Present Value = Remaining loan amount after 12 years / (1 + 0.0038333)^144
However, to calculate the remaining loan amount after 12 years, we need more information. Specifically, we need to know the payment schedule (e.g., fixed monthly payments) and any additional payments made towards the loan.
Could you please provide more information regarding the payment schedule and any additional payments made towards the loan so that we can calculate the present value after 12 years accurately?
3) To calculate the value of the home at the time of the present value, we will need more information. Specifically, we need to know the initial value of the home and the annual increase in home value for each year leading up to the present value time point.
Can you please provide the initial value of the home and the annual increase in home value for each year leading up to the present value time point so that we can calculate the value of the home accurately?