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Suppose you take a mortgage loan to buy a $600,000 house. The bank asks you for a 10% down-payment and quotes an APR (anmual percentage
Suppose you take a mortgage loan to buy a $600,000 house. The bank asks you for a 10% down-payment and quotes an APR (anmual percentage rate) of 4.5%. Please answer questions (41)-(44). 41. (5 points) What is the size of the loan? 42. (5 points) Suppose I take a 30 year fixed-rate mortgage: I need to malo monthly payments for 360 months, and 1 start making the payments at the end of the finst month. What is my monthly payment? 43. (5 points) In the first-month payment, how much is to pay for principal and how much: is to pay for interest? 44. (5 points) Suppose that my bank offers me a 31 year fixed-rate mortgage, but with no payment during the first year. That is, I make fixed payments for 350 months but starting a year from now (from mouth 13 to month 372). What is my balance (i.e. how much: I owe to the bank) with my bank when I start making the payments (i.e. at the end of month 12)
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