In order to buy a vacation home, Neal and Lilly took out a 20-year mortgage for $220,000 at an annual interest rate of 6%. After 10 years, they refinanced the unpaid balance of $142,125 at an annual rate of 4%. Use the table to find the monthly payments on the original loan; the monthly payments on the new loan; and the total amount saved on interest by refinancing.Click the icon to view a table of monthly payments on a $1,000 loan.The monthly payments on the original loan are $ [ ] (Type an integer or a decimal.)Enter your answer in the answer box and then click Check Answer.2 parts remaining[Visual of progress bar and interface elements for entering and checking answers] ### Monthly Payment on a $1,000 LoanThe table below displays the monthly payment required for a $1,000 loan, based on various annual interest rates and loan durations. The values are represented in dollars.#### Table: Monthly Payment Amounts| **Annual Interest Rate** | **3 Years** | **4 Years** | **10 Years** | **20 Years** | **30 Years** ||--------------------------|-------------|-------------|--------------|--------------|--------------|| **4%** | $29.53 | $22.58 | $10.12 | $6.06 | $4.77 || **5%** | $29.97 | $23.03 | $10.61 | $6.60 | $5.37 || **6%** | $30.42 | $23.49 | $11.10 | $7.16 | $6.00 || **8%** | $31.34 | $24.41 | $12.13 | $8.36 | $7.34 || **10%** | $32.27 | $25.36 | $13.22 | $9.65 | $8.78 || **12%** | $33.21 | $26.33 | $14.35 | $11.01 | $10.29 |#### Explanation:- **Annual Interest Rate**: The percentage cost of borrowing annually.- **Number of Years for the Loan**: The duration of the loan period.- **Monthly Payments**: Amount payable each month during the loan term.This table allows borrowers to determine their monthly obligations depending on the selected interest rates and time frames. As interest rates or loan periods increase, monthly payments can vary significantly. It highlights the impact of interest rates and loan term lengths on monthly loan payments.

A mortgage refers to a loan availed against the purchase of real estate which includes a house,…

In order to buy a vacation home, Neal and Lilly took out a 20-year mortgage for $220,000 at an annual interest rate of 6%. After 10 years, they refinanced the unpaid balance of $142,125 at an annual rate of 4%. Use the table to find the monthly payments on the original loan; the monthly payments on the new loan; and the total amount saved on interest by refinancing.

In order to buy a vacation home, Neal and Lilly took out a 20-year mortgage for $220,000 at an annual interest rate of 6%. After 10 years, they refinanced the unpaid balance of $142,125 at an annual rate of 4%. Use the table to find the monthly payments on the original loan; the monthly payments on the new loan; and the total amount saved on interest by refinancing.

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

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