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You need a 25-year, fixed-rate mortgage to buy a new home for $315,000. Your mortgage bank will lend you the money at an APR of
You need a 25-year, fixed-rate mortgage to buy a new home for $315,000. Your mortgage bank will lend you the money at an APR of 6.1 percent for this 300-month loan. However, you can afford monthly payments of only $1,550, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment.
How large will this balloon payment have to be for you to keep your monthly payments at $1,550? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Balloon payment $
You need a 25-year, fixed-rate mortgage to buy a new home for $315,000. Your mortgage bank will lend you the money at an APR of 6.1 percent for this 300-month loan. However, you can afford monthly payments of only $1,550, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. |
How large will this balloon payment have to be for you to keep your monthly payments at $1,550? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
| Balloon payment | $ |
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