Computing monthly payment for a mortgage loan

Assignment Help Finance Basics

Reference no: EM13826251

Problem:

You want to purchase a house that costs $325,000. You have a down payment of $65,000 and will take out a mortgage to make up the difference. The AMC Mortgage Corporation offers a quoted interest rate of 3.99 percent annually and you decide on a 30-year amortization period, with monthly payments.

(a) What is the amount of each monthly payment?

(b) You plan to pay off the mortgage loan at the end of fifteen years. How much would you need to come up with in fifteen years? How much interest would you have paid over the fifteen years?

(c) As an alternative to making monthly payments as in part (a), you are considering making weekly payments. Assuming that there are 52 weeks per year, how many years would it take to pay off the mortgage? How much would you have saved in interest?

Additional Information:

This question is basically belongs to the Finance as well as it explains about computing monthly payment for a mortgage loan.

Reference no: EM13826251

Questions Cloud

Effective communication for marketing managers : Effective Communication For Marketing Managers In International Markets

Critical review of literature on ethnicity in organizations : This problem relates to HR Management and it's a literature review on ethnicity and race in organizations. The significance of the terms ethnicity and race have been presented in the review

Computing effective yield to maturity for a bond : Research in Motion (RIM), once known as the global leader in wireless innovation, has lost its darling status after the introduction of the Apple iPhone.

Asset replacement project of replacing control device : Cranberry Manufacturing Company is considering an asset replacement project of replacing a control device. This old control device has been fully depreciated but can be sold for $4,000. The new control device, which is more automated, will cost $22,0..

Computing monthly payment for a mortgage loan : You want to purchase a house that costs $325,000. You have a down payment of $65,000 and will take out a mortgage to make up the difference. The AMC Mortgage Corporation offers a quoted interest rate of 3.99 percent annually and you decide on a 30..

Obtaining the socially optimal level of output : In the context of externalities, which method helps in obtaining the socially optimal level of output?

Computing average monthly payment for a car : You are the owner of a used car business near the York campus. Your company borrows money from a bank on a line of credit with a monthly interest rate of 0.50%.

Less risky investment of the two investments : The expected return for Asset S is 30%, and it has a standard deviation of 12%. The expected return for Asset T is 17%, and it has a standard deviation of 7%. Which of the following is a CORRECT statement? Asset T is the less risky investment of the ..

Standard deviation of a portfolio of two or more securities : The standard deviation of a portfolio of two or more securities is always equal to the weighted average of the standard deviation of each of the individual securities in the portfolio. A beta value of 2.0 for a security indicates the security has gre..

User Account

All Pages