Question

You would like to buy a house that costs $350,000. You have $50,000 in cash that...

You would like to buy a house that costs

$350,000.

You have

$50,000

in cash that you can put down on the​ house, but you need to borrow the rest of the purchase price. The bank is offering you a​ 30-year mortgage that requires annual payments and has an interest rate of

7%

per year. You can afford to pay only

$22,970

per year. The bank agrees to allow you to pay this amount each​ year, yet still borrow

$300,000.

At the end of the mortgage​ (in 30​ years), you must make a balloon​ payment; that​ is, you must repay the remaining balance on the mortgage. How much will be this balloon​ payment?

​Hint: The balloon payment will be in addition to the 30th payment.

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Answer #1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

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