TOTAL INTEREST PAID. You are considering purchasing a home that requires $450,000 mortgage at 5.25%. Using a simple interest Loan amortization schedule: A) What is the total amount that you would pay for the 30 year mortgage, including interest? B) What is the total amount that you would pay for the 15 year mortgage, including interest? C) What is the difference in the total interest paid between the two different maturities?

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Q: please step by step solution.

A: PART A: PART B: PART C:  PART D:

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Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.