You are thinking of purchasing a house. The house will cost $300,000 with a 20% down payment. The bank will charge you a 6% interest rate and will be for 30 years.
What would be the monthly payments on this house mortgage?
Determine the amortization table for the life of the mortgage.
How much of your second payment would be for interest? Principal?
How much will you have paid the bank in interest for the life of the mortgage?
A mortgage loan is a type of loan in which the lender requires the borrower collateral as protection for the loan amount for the risk of default. A mortgage loan is generally used for a bigger loan amount such as housing and car loan.
Answer and Explanation:
In this case, the loan amount would be the 80% of the total cost of the house which is equals to $240,000 as the 20% were paid as down...
See full answer below.
Become a member and unlock all Study Answers
Try it risk-free for 30 daysTry it risk-free
Ask a question
Our experts can answer your tough homework and study questions.Ask a question Ask a question
Learn more about this topic:
from Finance 102: Personal FinanceChapter 7 / Lesson 4