Difference in the monthly payment on the two mortgages

Assignment Help Financial Management

Reference no: EM131059780

You plan to purchase a $200,000 house using either a 30-year mortgage obtained from your local savings bank with a rate of 7.25 percent, or a 15-year mortgage with a rate of 6.50 percent. You will make a down payment of 20 percent of the purchase price.

a. Calculate the amount of interest and, seperately, principal paid on each mortgage. What is the difference in interest paid?

b. Calculate your monthly payments on the two mortgages. What is the difference in the monthly payment on the two mortgages?

Reference no: EM131059780

Questions Cloud

What is the inflation-adjusted principal on this coupon date : Consider an investor woh, on January 1, 2017, purchases a TIPS bond with an original principal of $100,000, an 4.50 percent annual (or 2.25 percent semiannual) coupon rate, and 5 years to maturity. Suppose that the semiannual inflation rate for the s..

Positive plate of the capacitor : The electric field within the capacitor has avalue of 170N/C, and each plate has an area of 7.5x10^-4m^2. What is the magnetic force (magnitude and direction) exerted on the positive plate of the capacitor?

Nine-year project is expected to generate annual revenues : A nine-year project is expected to generate annual revenues of $114,500, variable costs of $73,600, and fixed costs of $14,000. The annual depreciation is $3,500 and the tax rate is 34 percent. What is the annual operating cash flow?

A bivariate normal distribution the correlation coefficient : Show that for a bivariate normal distribution the correlation coefficient between x' and y' can be expressed in terms of the infinite expansion (Eq. 8.61).

Difference in the monthly payment on the two mortgages : You plan to purchase a $200,000 house using either a 30-year mortgage obtained from your local savings bank with a rate of 7.25 percent, or a 15-year mortgage with a rate of 6.50 percent. You will make a down payment of 20 percent of the purchase pri..

Calculate tootsie rolls weighted average cost of capital : Over the last twenty years there has been considerable consolidation in the confectionary business (e.g the acquisition of row tree PLC by nestle SA in 1988 and Cadbury by Kraft in 2010). you have a suspicion that a large food manufacturer might try ..

Describe to the management what is involved in sdn : CIS3003 2016 Assignment. Research and describe to the management what is involved in SDN (Software Defined Networks) approach to network management. In your explanation provide a description of the benefits of the process, benefits to the organis..

Show that maximizing expression : Show that maximizing expression (Eq. 8.37) yields the normal equations (Eq. 8.38),

What was the return on equity for the company : The Earnings per Share (EPS) of company LMN for 2012 was $ 6. The Book Value per share of the company was $ 72. What was the Return on Equity (RoE) for the company?

User Account

All Pages