Scott and Jen are looking at a house listed for $189,000. They will qualify for a 6% interest rate if they have a 20% down payment. How much will the monthly payments be on a 15-year mortgage?

Down Payment Loan Amount Monthly Payment ______

2. What two things are not included in the monthly payment that Scott and Jen need to consider before deciding if they can afford the home?

3. Scott and Jen are not sure they want to use their savings for a down payment because they would like to buy new furniture and appliances. They find a house on the market for $155,000, but they will have to pay 7% interest since they have decided to put zero down on a house. What will their monthly payments be on a 15-year mortgage? Down Payment Loan Amount Monthly Payment

4. How much more are Scott and Jen paying in total interest with no down payment, even though they bought a cheaper house? (Please calculate the difference manually. Hint: Multiply the monthly payment times the number of payments and then subtract the loan amount to get the total amount of interest paid for each.)

5. How much does their monthly house payment increase if they buy the $155,000 house with no down payment?

6. How much will the monthly payment be if they bought the less expensive house ($155,000) with a 15 year mortgage and paid 20% down in order to receive a 6% interest rate? They could then use the difference in the down payment for furniture. Down Payment Loan Amount Monthly Payment

7. Based on the difference in the down payments for question #1 and question #6, how much would they have to spend on furniture?

8. What is the total interest savings if they choose this option instead of the zero down at 7% interest? (Remember to calculate manually.)

9. How much will the monthly payment be if Scott and Jen decide on a 30 year mortgage on the $155,000 house with a 20% down payment at 6% interest? Down Payment Loan Amount Monthly Payment 10. How much do Scott and Jen save in total interest by taking out a 15-year mortgage versus a 30-year mortgage if they borrow $124,000 at 6% interest? (Remember to calculate manually.)