Amount of the monthly payment for the first seven years

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Reference no: EM132070106

You bought a house at 345,000$. You plan to pay 20% down and finance the rest over next 30 years. You are going to get an interest only loan, but only for the first seven years. After that, it will convert to an amortized loan, where you pay off the principal with part of each payment. At the end of the 30 years, you will have completely paid off the home. The interest rate is 6.4% compounded monthly.

1. What is the amount of the monthly payment for the first seven years? (the ineterest only segment)

2. What is amount of the monthly payment for the remainder of the loan (amortized part)?

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Reference no: EM132070106

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