The median home price in February, 2019 was approximately $315,000 (source https www census gov construction nrs pdf uspricemon pdf) Assume that a family is purchasing a typical house by making a $30,000 down payment and then financing a $285,000 mortgage at an annual interest rate of 4 00 (a typical rate for a 30 year loan in early 2019) The size of their monthly payment will depend on the term of the mortgage The Excel function pmt can be used to compute these monthly mortgage payments The 3 arguments of function pmt are 1) the monthly interest rate (0 040 12) 2) the total number of monthly payments and 3) the mortgage amount Find the monthly payments if the $285,000 was financed over 15 years Find the monthly payments if the $285,000 was financed over 30 years Multiply your answer to part (a) by the number of payments to find how much the family would need to pay in total over the life of the 15 year loan Subtract the principal amount from this to give the amount of interest paid over the life of the loan Multiply your answer to part (b) by the number of payments to find how much the family would need to pay in total over the life of the 30 year loan Subtract the principal amount from this to give the amount of interest paid over the life of the loan A standard rule for lenders is that a family's house payment should not exceed 28 of their monthly income For a family making $6500 per month, this would equate to $1820 per month Assuming monthly costs of $300 for property tax and homeowner's insurance, this would allow for a $1520 monthly mortgage payment Assuming that a family wants a monthly payment of $1520, the Excel function pv can be used to find the size of the mortgage a family could afford for various mortgage terms and interest rates The 3 arguments of function pv are 1) the monthly interest rate 2) the total number of payments and 3) the amount of each payment Assuming that a family wants to make a $1520 monthly payment, give the mortgage that a family could afford at an annual interest rate 4 00 for a 15 year mortgage Assuming that a family wants to make a $1520 monthly payment, give the mortgage that a family could afford at an annual interest rate 4 00 for a 30 year mortgage

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The median home price in February, 2019 was approximately $315,000 (source: https://www.census.gov/construction/nrs/pdf/uspricemon.pdf).Assume that a family is purchasing a typical house by making a $30,000 down

The median home price in February, 2019 was approximately $315,000 (source: https://www.census.gov/construction/nrs/pdf/uspricemon.pdf).Assume that a family is purchasing a typical house by making a $30,000 down payment and then financing a $285,000 mortgage at an annual interest rate of 4.00% (a typical rate for a 30-year loan in early 2019). The size of their monthly payment will depend on the term of the mortgage.

The Excel function "pmt" can be used to compute these monthly mortgage payments. The 3 arguments of function "pmt" are: 1) the monthly interest rate (0.040/12); 2) the total number of monthly payments; and 3) the mortgage amount.

Find the monthly payments if the $285,000 was financed over 15 years.
Find the monthly payments if the $285,000 was financed over 30 years.
Multiply your answer to part (a) by the number of payments to find how much the family would need to pay in total over the life of the 15-year loan. Subtract the principal amount from this to give the amount of interest paid over the life of the loan.
Multiply your answer to part (b) by the number of payments to find how much the family would need to pay in total over the life of the 30-year loan. Subtract the principal amount from this to give the amount of interest paid over the life of the loan.
A standard rule for lenders is that a family's house payment should not exceed 28% of their monthly income. For a family making $6500 per month, this would equate to $1820 per month. Assuming monthly costs of $300 for property tax and homeowner's insurance, this would allow for a $1520 monthly mortgage payment. Assuming that a family wants a monthly payment of $1520, the Excel function "pv" can be used to find the size of the mortgage a family could afford for various mortgage terms and interest rates. The 3 arguments of function "pv" are: 1) the monthly interest rate; 2) the total number of payments; and 3) the amount of each payment.
Assuming that a family wants to make a $1520 monthly payment, give the mortgage that a family could afford at an annual interest rate 4.00% for a 15-year mortgage.
Assuming that a family wants to make a $1520 monthly payment, give the mortgage that a family could afford at an annual interest rate 4.00% for a 30-year mortgage.