12. Mortgage payments Mortgages, loans taken to purchase a property, involve regular payments at fixed intervals and are treated as reverse annuities. Mortgages are the reverse of annuities, because you get a lump-sum amount as a loan in the beginning and then you make monthly payments to the lender. You've decided to buy a house that is valued at $1 million. You have $450,000 to use as a down payment on the house, and want to take out a mortgage for the remainder of the purchase price. Your bank has approved your $550,000 mortgage, and is offering a standard 30-year mortgage at a 9% fixed nominal interest rate (called the loan's annual percentage rate or APR). Under this loan proposal, your mortgage payment will be Per 4,425.42 month. Note: Round the final value of any interest rate used to four decimal places. $6,859.40 $5,974.32 $5,531.78