if i buy a house for $184,000, and plan on paying a down payment of 10% and doing a 30 year loan plan, what will my monthly payments be if the interest rate is 6%?
To calculate your monthly mortgage payments, you can use the formula:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
M = monthly mortgage payment
P = principal amount (loan amount - down payment)
i = monthly interest rate (annual interest rate divided by 12)
n = number of monthly payments (30 years * 12 months)
Given:
Principal amount (P) = $184,000 - (10% of $184,000)
P = $184,000 - $18,400
P = $165,600
Monthly interest rate (i) = 6% / 12
i = 0.06 / 12
i = 0.005
Number of monthly payments (n) = 30 years * 12 months
n = 360
Now, substituting the values into the mortgage formula:
M = $165,600 [ 0.005(1 + 0.005)^360 ] / [ (1 + 0.005)^360 – 1]
By evaluating this equation, your monthly mortgage payments will be approximately $992.13.