You are buying a home that costs $225,000. You can choose to obtain a 15-year mortgage or a 30-year mortgage. Assume the interest rate is 5% for both types of mortgages.
a) What will be the monthly payment for the 15-year mortgage? the 30-year mortgage?
b) How much total interest will you pay on the 15-year mortgage? the 30-year mortgage?

Answer rating: 100% (QA)

To calculate the monthly payment for a mortgage we can use the formula for a fixedrate mortgage PMT ... View the full answer