Question

How do I amortize a $799,000, 30 year mortgage at 3.522%? I don't understand how to do the formula. I need principal and interest for the first month.

Answer 1

First, you need to calculate monthly loan payments, this can be done in two ways, by using the financial calculator or using excel,

Using Excel, calculate as follows:-

=PMT(rate,nper,pv)

=PMT(3.522%/12,30*12,799000)

=3597.69

Or using a financial calculator, calculate for PMT and punch in:

I/Y =3.522%/12 =0.2935%

N =30*12 =360

PV =799000

The answer will be 3597.69

This is the amount that you will pay monthly for 360 months,

So interest for the first month will be equal to =799000*0.2935% = $2345.065

And principal for the first month will be the rest of the monthly payment minus the interest =3597.69-2345.065 =$1252.621