You would be borrowing $350,000 for a home loan at 3% interest, but you are given two options: pay off the loan in 30 years, or pay off the loan in 15 years. Specifically question 4 1. Compute the payment for each (the 30-year loan and the 15-year loan). 2. Compute the amount paid over the life of both loans (payment amount times number of payments) 3. Compute the total interest paid over the life of both loans (total paid minus amount borrowed). 4. Decide whether you would choose the 30-year or the 15-year loan. Explain
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
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You would be borrowing $350,000 for a home loan at 3% interest, but you are given two options: pay off the loan in 30 years, or pay off the loan in 15 years. Specifically question 4
1. Compute the payment for each (the 30-year loan and the 15-year loan).
2. Compute the amount paid over the life of both loans (payment amount times number of payments)
3. Compute the total interest paid over the life of both loans (total paid minus amount borrowed).
4. Decide whether you would choose the 30-year or the 15-year loan. Explain
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