Question

Oprah Winfrey has closed on a 42-acre estate near Santa Barbara, California, for $49,400,000. If Oprah puts 25% down and finances at 7.5% for 30 years, what would her monthly payment be? (Do not round intermediate calculations. Round your answer to the nearest dollar amount.)

Answer 1

Information provided:

Purchase price of property= $49,400,000

Down payment= 0.25*$49,400,000= $12,350,000

Mortgage= $49,400,000 - $12,350,000= $37,050,000

Interest rate= 7.50%

Time= 30 years

The monthly payment of the mortgage is calculated by entering the below in a financial calculator:

PV= -37,050,000

I/Y= 7.50/12= 0.6250

N= 30*12= 360 months

Press the CPT key and PMT to calculate the monthly payment.

The value obtained is 259,058.98

Therefore, the amount of monthly payment is $259,058.98

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