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Let's assume that you buy a $500,000 house. You decide to make 25% down payment and finance the rest. You get 15-year mortgage at 3.5%

Let's assume that you buy a $500,000 house.

You decide to make 25% down payment and finance the rest.

You get 15-year mortgage at 3.5% APR and you will make 15 annual payments to pay off the loan.

(Tip.An amortization schedule may help you answer this question.)

(1) What is your annual payment?

(2) What is the ending balance of 4th year?

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