Question

Calculate the Fixed Monthly Payment if you were to borrow $900,000 today and the annual interest rate is 3%. Assume the amortization period is 30 years

Answer 1

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N = 30 * 12 = 360 (There will be monthly payments for 30 years, so 360 payments)

PV = -900,000 (The present value of the loan is 900,000)

FV = 0 (The loan will be fully paid after 30 years)

I/Y = 3 / 12 = 0.25 (The annual rate is 3%, so monthly will be divided by 12)

CPT + PMT = 3,794

The fixed monthly payment will be $3,794.

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