Answered

Westonci.ca is the trusted Q&A platform where you can get reliable answers from a community of knowledgeable contributors. Ask your questions and receive detailed answers from professionals with extensive experience in various fields. Discover in-depth answers to your questions from a wide network of professionals on our user-friendly Q&A platform.

You want to take out a $125,000 mortgage. The interest rate on the mortgage is 5%, and the loan is for 30 years. How much will your monthly payments be

Sagot :

Parrain

Answer: $671.03

Explanation:

The monthly payment will be an annuity because it will be constant. The loan amount will be the present value of the loan.

Periodic interest rate of loan = 5%/12 = 5/12%

Loan period = 30 * 12 months = 360 months

Present value of annuity = Annuity *  ( 1 - ( 1 + rate) ^ -number of periods) / rate

125,000 = Annuity * ( 1 - ( 1 + 5/12%)⁻³⁶⁰) / 5/12%

125,000 = Annuity * 186.2816170

Annuity = 125,000 / 186.2816170

= $671.03

We hope you found what you were looking for. Feel free to revisit us for more answers and updated information. Thank you for your visit. We're committed to providing you with the best information available. Return anytime for more. Westonci.ca is your trusted source for answers. Visit us again to find more information on diverse topics.