Question: Question 1 : You borrow $ 5 0 0 , 0 0 0 to buy a house using a 3 0 - year loan. The

Question 1: You borrow $500,000 to buy a house using a 30-year loan. The mortgage rate is 5.4% annually, payments are monthly and occur at the end of the month. If you pay for the house according to the loan agreement, how much total interest will you pay? Answer without a $ sign, without a + or - sign, and to two decimal places.
Question 2: Molly is able to pay $1250 a month for a 25-year mortgage with end of month payments. Because of a family gift, Molly can make a 20% cash down payment to purchase a house. If the interest rate is 5.4%, then how much house can Molly afford to buy? Answer without a $ sign, without a + or sign, and to two decimal places.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!