Hi, I need help. I have tried plugging in the the N formula d=1036.44+100 and Po=200070 and r=0.0469 and keep getting the wrong answer. What am I doing wrong?

While using a 15 year mortgage saves you money on interest compared to the 30 year mortgage, the monthly payment for the 15 year loan is higher than the 30 year. A good alternative is to use a 30 year loan, but to make extra payments toward the principal. This approach gives the homeowner some flexibility (you can always pay the minimum monthly payment if you can't pay the extra principal) but results in saving money on interest and paying the loan off quicker. To see the effect of making extra principal payments, you'll need some information from Question 1. Recall from Question 1, the original loan amount was $200070 and the 30 year interest rate expressed as a decimal was r=0.0469. Recall that 30 year monthly payment from Question 1. It should have been approximately: 30 year monthly payment = $1036.44 Using this value, suppose that you pay an additional $100 a month toward principle. You will need to figure out how long it will take to pay off the loan with this additional payment. In order to do this, you would have to solve the following loan formula for N, which represents years: 12N d' (1-(1+ a) *" 12 Po = 12 (Note: Po is the original loan amount from Question 1 and here we have used k = 12 and d' is your monthly payment plus the additional $100) In order to solve the above equation for N you would use logarithms. Using the notation log for the common logarithm, you would get the following formula: (Note: Po is the original loan amount from Question 1 and here we have used k = 12 and dis your monthly payment plus the additional $100.) In order to solve the above equation for N you would use logarithms. Using the notation log for the common logarithm, you would get the following formula: log { } Pr) (12 log(1+) 12d (12d* - Por) N= 12 Use the above formula to figure out N, the number of years it will take to pay off the loan with the additional $100 payment. Alternatively, use an online amortization calculator such as: http://bretwhissel.net/amortization/amortize.html. You will need to enter the principal, the annual interest rate from this question, and the payment amount (your d'). Leave the "number of regular payments" blank and hit "Calculate". The number of regular payments divided by 12 should agree with N from the formula above. Find N accurate to two decimal places- don't round any more than that! Give it a try! N 0.00249322 To find the total interest paid you need the number of payments you made (which you either have or can get from N by multiplying it by 12). You can round the number of payments to the nearest whole number Total number of regular payments Now you can find the total payments and the total interest paid. Don't forget to add the additional $100 to your monthly payment before multiplying by the number of payments. Total payments = $ log 12d (12d' - Por) N= (1210g(1+r)) Use the above formula to figure out N, the number of years it will take to pay off the loan with the additional $100 payment. Alternatively, use an online amortization calculator such as: http://bretwhissel.net/amortization/amortize.html. You will need to enter the principal, the annual interest rate from this question, and the payment amount (your d). Leave the "number of regular payments" blank and hit "Calculate". The number of regular payments divided by 12 should agree with N from the formula above. Find N accurate to two decimal places-don't round any more than that! Give it a try! N= 0.00249322 To find the total interest paid you need the number of payments you made (which you either have or can get from N by multiplying it by 12). You can round the number of payments to the nearest whole number Total number of regular payments Now you can find the total payments and the total interest paid. Don't forget to add the additional $100 to your monthly payment before multiplying by the number of payments. Total payments Total interest paid 118039 X Recall that the total interest paid from Question 1 was $173048.4. How much do you end up saving in interest if you pay the additional $100 per month? Save in interest = $ 30443