PLEASE HELP
You purchase a house, and must borrow money from the bank to do so (a mortgage). You borrow $307,000 to be paid back over 30 years in monthly installments (starting in month 1). If the interest rate is 5% per year, what is your monthly mortgage payment? Round to the nearest cent.
Thank you in advance!
Solution:
Loan amount = $307,000
Period = 30 years, 360 monthly periods
Interest rate = 5% per annum = 0.41666666% per month
Monthly installment amount = $307,000 / Cumulative PV Factor at 0.41666666% for 360 periods
= $307,000 / 186.28162
= $1,648.04
PLEASE HELP You purchase a house, and must borrow money from the bank to do so...