Calculate your bi-weekly payment

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Problem - Your four-year work term is now over, and you managed to do quite a lot of travelling while overseas both for business and pleasure. Upon your return, you decide to put a down payment on a house. You also received a bonus at the end of your contract and so you have $30,000 as a down payment towards a starter home costing $285,000. You have been approved for a mortgage to cover the balance of $255,000. The mortgage is amortized over 25 years and has a 3.25% APR compounded bi-weekly.

a. Calculate your bi-weekly payment.

b. Determine how much of the first payment will go towards interest and how much will go towards the principal?

c. How much interest will be paid over the course of 25 years?

d. In five years, the mortgage will need to be renewed. How much will be owing at that time?

Reference no: EM132857147

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