You just purchased a home for $300,000 and you made a required down payment of 20% ($60,000).

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Question:

You just purchased a home for $300,000 and you made a required down payment of 20% ($60,000). So you are financing $240,000 over 30 years (360 months) at 3%.

A) How much are your payments on the loan?

B) Your spouse is a great financial planner and says it would be very prudent to pay an EXTRA $200 per month on the mortgage payments. How many monthly payments will you "knock off" or reduce your original 360 payments? How much interest will you save over the life of the loan by making the extra $200 per month payment?