Calculate the monthly payments to be paid

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Question - Michael Brooks is buying a house for $2 000 000. He made an agreement with the National Housing Trust (NHT) to provide 45% financing for his new home. It was agreed with the NHT that he will make monthly payments over five (5) years at 12% per annum. The remainder of the funds required to cover the cost of the house will be borrowed from his commercial bank. The terms of the agreement for the bank loan are, 25% down payment, and the balance is to be repaid at 20% interest over a three (3) year period.

Required -

a. Calculate the monthly payments to be paid over to the National Housing Trust (NHT) if payments are made at the end of each month.

b. Calculate the annual end of year payments to be paid to the commercial bank.

c. Considering part (b), prepare the amortization schedule for this loan.

Reference no: EM132976062

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