What are the monthly payments on the loan

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You are planning to buy a new house. You currently have $35,000 and your bank told you that you would need 15% down payment plus an additional 4% in closing costs (Hint: Total loan amount is 85% of the home price. Closing cost is calculated as 4% of the total loan amount. Total amount needed at closing = Down payment + closing cost. It will be due at closing and will NOT be part of the mortgage). If the house that you want to buy costs $250,000 and you can make a 7% annual return on your investment

Assume that three years later the house still has the same price and that you can get a 15-year mortgage from your bank at a fixed rate of 4.5%:

Problem 1. What are the monthly payments on the loan?

Problem 2. How much do you pay on interest and principal the 50th monthly payment?

Reference no: EM132944227

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