Question

You have found your dream home in Memphis, Tennessee! The home is priced at $379,200, and the bank requires a 3% down payment. You plan to finance the home for thirty years, and you will make monthly payments on the home loan. The bank offers you a 1.79% interest rate. What is your monthly house payment?

Answer 1

Price of House = $379,200

Down- payment = 3%

Loan Amount = Price of House*(1 - % of downpayment)

Loan Amount = $379,200*(1-0.03)

Loan Amount = $367,824

Calculating the Monthly Loan Payment:-

Where, P = Loan amount = $367,824

r = Periodic Interest rate = 1.79%/12 = 0.1491666%

n= no of periods = 30 years*12 = 360

Monthly Payment = $1321.25

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