Heather McIntosh recently purchased a home for $175,000. She put $22,500 down and took out a 25-year loan at 6.5 percent interest. Round your answers to the nearest cent. Use Table 9-4 to determine her monthly payment. Round Estimating Mortgage Loan Payments for Principal and Interest in your intermediate calculations to four decimal places. How much of her first payment will go toward interest and principal? Interest will be $ Principal will be $ How much will she owe after that first month? (table 9-2) $ How much will she owe after three months? Do not round intermediate calculations.
Heather McIntosh recently purchased a home for $175,000. She put $22,500 down and took out a 25-year loan at 6.5 percent interest. Round your answers to the nearest cent. Use Table 9-4 to determine her monthly payment. Round Estimating Mortgage Loan Payments for Principal and Interest in your intermediate calculations to four decimal places. How much of her first payment will go toward interest and principal? Interest will be $ Principal will be $ How much will she owe after that first month? (table 9-2) $ How much will she owe after three months? Do not round intermediate calculations.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Heather McIntosh recently purchased a home for $175,000. She put $22,500 down and took out a 25-year loan at 6.5 percent interest. Round your answers to the nearest cent.
-
Use Table 9-4 to determine her monthly payment. Round Estimating Mortgage Loan Payments for Principal and Interest in your intermediate calculations to four decimal places.
-
How much of her first payment will go toward interest and principal?
Interest will be $
Principal will be $
How much will she owe after that first month? (table 9-2)
$
-
How much will she owe after three months? Do not round intermediate calculations.
Transcribed Image Text:Table 9-2
First Month
Second Month
Third Month
Amortization Effects of Monthly Payment of
$978.03 on a $200,000, 30-Year Mortgage Loan
at 4.2 Percent
$200,000 x 4.2% x 1/12 = $700.00 Interest payment
$278.03 Principal repayment
$978.03 - 700.00
$200,000 278.03
$199,800.90 x 4.2% × 1/12
$978.03 699.02
$199,721.97 279.01 =
$199,721.97 Balance due
$699.02 Interest payment
$279.01 Principal repayment
$199,442.96 Balance due
$698.05 Interest payment
$279.98 Principal repayment
$199,162.98 Balance due
$199,442.96 x 4.2% × 1/12
$978.03 698.05
$199,442.96279.98
=
=
=
=
=
=
=
![Table 9-4
Estimating Mortgage Loan Payments for Principal
and Interest (Monthly Payment per $1,000 Borrowed)
15
$6.9058
Interest Rate (%)
30
3.0
$4.2160
3.5
4.4904
4.0
4.7742
4.5
6.3265
5.0669
5.0
6.5996
5.3682
5.5
6.8789
5.6779
6.0
7.1643
5.9955
6.5
7.4557
6.3207
7.0
7.7530
6.6530
7.5
8.0559
6.9921
8.0
8.3644
7.3376
Note: To use this table to figure a monthly mortgage payment, divide the amount borrowed by 1,000 and multiply by the
appropriate figure in the table for the interest rate and time period of the loan. For example, a $160,000 loan for 30 years
at 6.0 percent would require a payment of $959,280 [($160,000 1,000) x 5.9955]; over 20 years, it would require a
payment of $1,146.29 [($160,000 + 1,000) x 7.1643]. For calculations for different interest rates, visit the Garman/Forgue
companion website.
Payment Period (Years)
20
25
$5.5460
$4.7421
5.7996
5.0062
6.0598
5.2783
5.5583
5.8459
6.1409
6.4430
6.7521
7.0678
7.3899
7.7182
7.1488
7.3969
7.6499
7.9079
8.1708
8.4386
8.7111
8.9883
9.2701
9.5565](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Feed8f33c-5e0d-47f3-bbf2-72eddaf64593%2F4b1f9eda-c138-4778-8475-da3b6dff2461%2Fye7i6jj_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Table 9-4
Estimating Mortgage Loan Payments for Principal
and Interest (Monthly Payment per $1,000 Borrowed)
15
$6.9058
Interest Rate (%)
30
3.0
$4.2160
3.5
4.4904
4.0
4.7742
4.5
6.3265
5.0669
5.0
6.5996
5.3682
5.5
6.8789
5.6779
6.0
7.1643
5.9955
6.5
7.4557
6.3207
7.0
7.7530
6.6530
7.5
8.0559
6.9921
8.0
8.3644
7.3376
Note: To use this table to figure a monthly mortgage payment, divide the amount borrowed by 1,000 and multiply by the
appropriate figure in the table for the interest rate and time period of the loan. For example, a $160,000 loan for 30 years
at 6.0 percent would require a payment of $959,280 [($160,000 1,000) x 5.9955]; over 20 years, it would require a
payment of $1,146.29 [($160,000 + 1,000) x 7.1643]. For calculations for different interest rates, visit the Garman/Forgue
companion website.
Payment Period (Years)
20
25
$5.5460
$4.7421
5.7996
5.0062
6.0598
5.2783
5.5583
5.8459
6.1409
6.4430
6.7521
7.0678
7.3899
7.7182
7.1488
7.3969
7.6499
7.9079
8.1708
8.4386
8.7111
8.9883
9.2701
9.5565
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