Client #19

Kit and Kendry want to buy a $360,000 house. Your bank can offer them a 25-year conventional mortgage at a 4.95% rate, with a 20% down payment. The bank also will charge them 2 points at closing.

1. (3 pt) Determine the amount of the required down payment. Show all steps. Write the answer in a complete sentence.

2. (2 pt) Determine the amount of the loan. Show all steps. Write the answer in a complete sentence.

3. (3 pt) Determine the amount Kit and Kendry will have to pay for points. Show all steps. Write the answer in a complete sentence.

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4. (5 pt) Determine Kit and Kendrys monthly payment (principal and interest). Write out 1) the correct formula with variables (e.g. P₀, P_N, N, r, etc.), and 2) the correct formula with the numerical values (round your answer to the nearest cent, 3) write the answer in a complete sentence.

5. (5 pt) How much will Kit and Kendry pay total, at the end of the 25 years? Show all steps. Write the answer in a complete sentenc

6. (4 pt) How much of that total is interest?