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# Mortgage Payoff: You take out a 30-year fixed rate mortgage for a house. The amount borrowed is $300,000. The interest rate is 4% per year

- Mortgage Payoff: You take out a 30-year fixed rate mortgage for a house. The amount borrowed is $300,000. The interest rate is 4% per year compounded monthly. You decide to sell the house immediately after the 60
^{th}payment (five years). How much do you still owe on the loan? - What is the total amount you have paid the lender by the time you sell the house?
- How much principal have you paid the lender by the time you sell the house?
- How much interest have you paid the lender by the time you sell the house?
- What fraction of your payments went to reducing the principal?

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### Step: 1

Lets go through the problem step by step to calculate the various amounts related to the mortgage Step 1 Calculate the Monthly Payment The monthly mortgage payment for a fixedrate mortgage can be calc...### Get Instant Access to Expert-Tailored Solutions

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### Step: 2

### Step: 3

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