Mr. and Mrs. Hobbs moved and were delighted to find a house for sale that they loved where they would have to borrow $120,000. They need to decide between a 20-year or 30-year loan, both loans are at a 9.6% per year interest rate compounded monthly.

1. Find the monthly payments for the 20-year loan. Work Here:

2. Find the monthly payments for the 30-year loan. Work Here:

3. Find the savings per month by going to the 30-year loan. Work Here (No images of written work):

4. Find the total amount paid over the life of the 20-year loan. Work Here (No images of written work):

5. Find the total amount paid over the life of the 30-year loan. Work Here (No images of written work):

6. Find the total savings by going to the 20-year loan. Work Here (No images of written work):

7. Which loan would you advise Mr. and Mrs. Hobbs to choose? Use the information gathered from the previous answers to justify your response.