At Westonci.ca, we make it easy to get the answers you need from a community of informed and experienced contributors. Get quick and reliable solutions to your questions from a community of seasoned experts on our user-friendly platform. Experience the convenience of finding accurate answers to your questions from knowledgeable experts on our platform.
Sagot :
The interest rate in during the initial period is given from which the
monthly payment is calculated to be $1682.94
Response (approximate value):
- The monthly payment during the initial period is $1,682.94
What is an ARM and how does it determine the monthly payment?
The type of loan Jackie obtains is an Adjustable Rate Mortgage, ARM,
loan, which is a 4/2 ARM
Therefore;
The introductory interest rate of 5% is fixed for the first 4 years, and will
be adjusted every 2 years after the first four years.
[tex]Initial \ monthly \ payment, \ M = \mathbf{\dfrac{P \cdot \left(\dfrac{r}{12} \right) \cdot \left(1+\dfrac{r}{12} \right)^n }{\left(1+\dfrac{r}{12} \right)^n - 1}}[/tex]
Where;
M = The monthly payment during the initial period
P = The amount on loan = $313,500
r = 5% = 0.05
n = 30 × 12 = 360
Which gives;
- [tex]M = \dfrac{313500 \times \left(\dfrac{0.05}{12} \right) \cdot \left(1+\dfrac{0.05}{12} \right)^{360} }{\left(1+\dfrac{0.05}{12} \right)^{360} - 1} \approx \mathbf{1682.94}[/tex]
- The monthly payment during the initial period, M ≈ $1,682.94
Learn more about mortgage payment calculations here:
https://brainly.com/question/2151755
Thank you for visiting. Our goal is to provide the most accurate answers for all your informational needs. Come back soon. We hope our answers were useful. Return anytime for more information and answers to any other questions you have. We're glad you chose Westonci.ca. Revisit us for updated answers from our knowledgeable team.
