Question

You plan to purchase a $130,000 house using a 15-year mortgage obtained from your local credit...

You plan to purchase a $130,000 house using a 15-year mortgage obtained from your local credit union. The mortgage rate offered to you is 5.25 percent. You will make a down payment of 20 percent of the purchase price.

a.
Calculate your monthly payments on this mortgage. (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Monthly payment $   

b.
Construct the amortization schedule for the first six payments. (Do not round intermediate calculations. Round your answers to 2 decimal places. (e.g., 32.16))

Amortization Schedule for first 6 payments (months)
Month Beginning Loan Balance Payment Interest Principal Ending Loan
Balance
1 $ $ $ $ $   
2
3
4
5
6


Homework Answers

Answer #1
a) We can use excel formula to calculate this
PMT(r%,t,-P)
Where=r%=monthly interest=5.25%/12; t=months=15*12=180; p=mortgage=130000*(1-20%)=$104,000
=pmt(5.25%/12,180,-104000)
$836.03
b) Month Beginning loan balance Payment Interest Principal Ending loan
1 $ 104,000.00 $ 836.03 $ 455.00 $ 381.03 $ 103,618.97
2 $ 103,618.97 $ 836.03 $ 453.33 $ 382.70 $ 103,236.27
3 $ 103,236.27 $ 836.03 $ 451.66 $ 384.37 $ 102,851.89
4 $ 102,851.89 $ 836.03 $ 449.98 $ 386.06 $ 102,465.84
5 $ 102,465.84 $ 836.03 $ 448.29 $ 387.74 $ 102,078.09
6 $ 102,078.09 $ 836.03 $ 446.59 $ 389.44 $ 101,688.65
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