Mortgages, loans taken to purchase a property, involve regular payments at fixed intervals and are treated as reverse annuities. Mortgages are the reverse of annuities, because you get a lump-sum amount as a loan in the beginning, and then you make monthly payments to the lender. You've decided to buy a house that is valued at $1 million. You have $350,000 to use as a down payment en the house, and want to take out a. mortgage for the remainder of the purchase price. Your bank has approved your $650,000 mortgage, and is offering a standard 30 -year mortgage at a 10% fixed nominal interest rate (called the loan's annual percentage rate or APR). Under this loan proposal, your mortgage payment will be per month. (Note: Round the final value of any interest rate in percentage form to four decimal places.) Your fnends suggest that you take a 15 -year mortgage, because a 30 -year mortgage is too long and you wil pay a lot of money on interest. If your bank approves a 15 -year, $650,000 loan at a foced nominal interest rate of 10% (APR), then the difference in the monthly payment of the 15 -year mortgage and 30 -year mortgage will be - (Note: Round the final value of any interest rate in percentage form to four decimal places.) It is likely that you won't like the prospect of paying more money each month, but if you do take out a 15 -year mortgage, you will make far fewer payments and will pay a lot less in interest. How much more total interest will you pay over the life of the loan if you take out a 30 -year mortgage inatead of a is-year mortgage? $1,018,653.70 $939,071.38 $795,023.20 $1,093,236.02 Which of the following statements is not true about mortgages? The ending balance of an amortized loan contract will be zero. If the payment is less than the interest due, the ending balance of the loan will decrease. Mortgages are examples of amortized loans. Every payment made toward an amortized loan consists of two parts-interest and repayment of principal, $1,018,653,70 $939,071.38 $795,823.20 $1,008,236.02 Which of the following statements is not true about mortgages? The ending balance of an amortiaed loan contract wil be aera. If the payment is less than the interest due, the ending balance of the loan wal decrease. Mortgoges are tramples of amortined louns. Every payment made toward an amortized loan consists of twe parts-interest and repryment of 5 taken to purchase a property, involve regular payments at fixed intervals and are treated as ties, because you get a lump-sum amount as a loan in the beginning, and then you make mon ouy a house that is valued at $1 million. You have $350,000 to use as a down payment on t semainder of the purchase price. Your bank has approved your $650,000 mortgage, and is of hal interest rate (called the loan's annual percentage rate or APR). Under this loan proposal, yc per month. (Note: Round the final value of any interest rate in percentage form to four decin gest that you take a 15 -year mortgage, because a 30 -year mortgage is too long and you will p 15-year, $650,000 loan at a foxed nominal interest rate of 10N (APR), then the difference in 0 -year mortgage will be . (Note: Round the final value of any interest rate in you won't like the prosp will pay a lot less in inter year mortgage? 8,653.70 .071 .38 823.20 ore money each month, but if you do take out a 15 -year more total interest will you pay over the life of the loan 98,236.02
