Math

Sarah secured a bank loan of $200,000 for the purchase of a house. The mortgage is to be amortized through monthly payments for a term of 15 yr, with interest rate of 6%/year compounded monthly on the unpaid balance. She plans to sell her house in 5 yr. How much will Sarah still owe on her house?

  1. 👍
  2. 👎
  3. 👁
  1. payment = ?
    n = 180
    i = .06/12 = .005
    200000 = paym( 1 - 1.005^-180)/.005
    paym = 1687.71

    balance after 5 years
    = 200000(1.005)^60 - 1687.71(1.005^60 - 1)/.005
    =269770.03 - 117751.83
    = 152018.20

    1. 👍
    2. 👎

Respond to this Question

First Name

Your Response

Similar Questions

  1. Finance: Mortgages

    A borrower received a 30-year ARM mortgage loan for $200,000. Rate caps are 3/2/6 (initial adjustment cap/periodic interest rate cap/lifetime interest rate cap). The start rate is 3.50% and the loan adjusts every 12 months for the

  2. math

    Case: A borrower received a 30-year ARM mortgage loan for $200,000. Rate caps are 3/2/6. The start rate is 3.50% and the loan adjusts every 12 months for the life of the mortgage. The index used for this mortgage is LIBOR (for

  3. Financial

    You need a 30-year, fixed-rate mortgage to buy a new home for $235,000. Your mortgage bank will lend you the money at an APR of 5.35 percent for this 360-month loan. However, you can afford monthly payments of only $925, so you

  4. MATH 123

    Darla purchased a new car during a special sales promotion by the manufacturer. She secured a loan from the manufacturer in the amount of $23,000 at a rate of 4.6%/year compounded monthly. Her bank is now charging 6.2%/year

  1. finance

    You borrow $149,000 to buy a house. The mortgage rate is 7.5 percent and the loan period is 30 years. Payments are made monthly. If you pay for the house according to the loan agreement, how much total interest will you pay?

  2. Finite Math

    Five years ago, Diane secured a bank loan of $370,000 to help finance the purchase of a loft in the San Francisco Bay area. The term of the mortgage was 30 years, and the interest rate was 10% per year compounded monthly on the

  3. business math

    Shantel and Kwamie are planning to buy their first home. Although they are excited about the prospect of being homeowners, they are also a little frightened. A mortgage payment for the next 30 years sounds like a huge commitment.

  4. MATH

    a borrower received a 30 year ARM mortgage loan for 200,000. Rate caps are 3/2/6 the start rate is 3.50% AND the loan adjusts every 12 months for the life of the mortgage, The index used for this mortgage is LIBOR which for this

  1. math

    The Taylors have purchased a $290,000 house. They made an initial down payment of $10,000 and secured a mortgage with interest charged at the rate of 10%/year on the unpaid balance. Interest computations are made at the end of

  2. U.S. and Global Economics

    The owner of a flower shop needs a short-term loan to tide her business over until she completes the sale of some unused property. She asks the bank for a $25,000 six-month loan. The bank agrees to give her the loan, but attaches

  3. Finance

    You are considering borrowing $150,000 to purchase a new home. a. Calculate the monthly payment needed to amortize an 8 percent fixed-rate 30-year mortgage loan. b. Calculate the monthly amortization payment if the loan in (a) was

  4. math

    jessica borrow$9000 from the bank to purchase a used car.the bank has given her an interest rate of 7.5%annually for a period of 2 1/2 year what is the total amount she will have to pay back at the end of the loan A)$1687.50

You can view more similar questions or ask a new question.