Client #9

Ingrid is buying a house selling for $345,000. She is coming to your bank for a 20-year mortgage. Your bank is offering a 3.95% interest rate but requires a 15% down payment and charges 1.25 points.

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 Ingrid will have to pay for points. Show all steps. Write the answer in a complete sentence.

4. (5 pt) Determine Ingrids 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 Ingrid pay total, at the end of the 20 years? Show all steps. Write the answer in a complete sentenc

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