Question
Need help with all please You just acquired a mortgage in the amount of $500,000 at 0.25% per month interest. Equal payments are to be
Need help with all please
You just acquired a mortgage in the amount of $500,000 at 0.25% per month interest. Equal payments are to be made at the end of each month for 15 years.
#1. What is the annual percentage (APR) on this loan?
#2. What is the effective annual rate (EAR) on this loan?
#3. If you paid $150 extra each month, how much can you save in interest payments compared to the original loan schedule?
*hint: first you will need to find total interest payments from the original loan schedule
#4. And how much can you save in time? That is, by paying extra $150 extra each month, how many years faster can you finish paying your mortgage?
#1. APR = 2.5% | ||
#1. APR = 3% | ||
#1. APR = 3.7% | ||
#1. APR = 4.2% | ||
#2. EAR = 4.82% | ||
#2. EAR = 2.91% | ||
#2. EAR = 3.04% | ||
#2. EAR = 3.64% | ||
#3. save interest of approx. $7210 | ||
#3. save interest of approx. $8550 | ||
#3. save interest of approx. $9870 | ||
#3. save interest of approx. $6690 | ||
#4. save time by approx. a little less than a year | ||
#4. save time by approx. 2 years | ||
#4. save time by approx. 5 years | ||
#4. save time by approx. 10 years |
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