Question

You want to buy a $245,000 home. You plan to pay 10% as a down payment, and take out a 30 year loan for the rest.

a) How much is the loan amount going to be?

$

b) What will your monthly payments be if the interest rate is 5%?

$

c) What will your monthly payments be if the interest rate is 6%?

$

Answer 1

Answer a)
Net Loan = House Price - Down Payment

= 245000 - 10% * 245000

= 220500

Answe b)

EMI =

r is the rate of interest for a compounding period i.e. 0.05/ 12 = 0.00416666666

n is the no of compoundind period i.e. 30years * 12 = 360 months

=

= 1183.69

Answe c)

EMI =

r is the rate of interest for a compounding period i.e. 0.06/ 12 = 0.005

n is the no of compoundind period i.e. 30years * 12 = 360 months

=

= 1322