A homeowner obtains a $500,000.00 loan at an interest rate of 6-1/8% based on a 30 year amortization schedule.

• What is the monthly payment?

• What is the total amount of interest that would be paid over the life of the loan?

Assume that after the 48th payment, the homeowner pays an additional $200.00 per month.

• At what month would the loan be paid in full?
• How many years sooner would the loan be paid off, versus just making regular monthly payments?
• How much interest would the homeowner save paying off the loan quicker than over the original term?