I. A family buys a house worth $326,000. They pay a deposit of $75,000 and take a
Question:
I. A family buys a house worth $326,000. They pay a deposit of $75,000 and take a mortgage for the balance of J12=9% annually to be amortized over 30 years in monthly payments. A. Have you found the value of their mortgage on their home? (1 point) B. Did you find the value of the monthly payment? (3 points) C. Did you find the remaining credit after making 20 payments? (4 points) D. Did you find the principal paid on the 21st payment? (5 points)
II. Complete the loan amortization schedule provided in the solution template for the first 5 loan payments. What do you notice about the composition of the payment amount? (6 points)
III. Suppose that after making 50 payments, the interest rate changes to J2=9% pa:
A. Convert the interest rate J2=9% to the equivalent of J12 (2 points
B. Assuming the family is trying to accept the change in interest rates, what will their new payments be based on the new interest rate? ( 5 points)
C. Assuming the family wants to keep their initial monthly payments calculated in part I, how many full payments are required to pay off the loan and how much?
College Mathematics for Business Economics Life Sciences and Social Sciences
ISBN: 978-0321614001
12th edition
Authors: Raymond A. Barnett, Michael R. Ziegler, Karl E. Byleen