You wish to purchase a house for $250,000 with 10% down. You will have it financed for 30 years at a rate of 10%.

What is the monthly payment needed to pay off the loan?

How much money goes towards the interest from the first payment?

What is the total interest paid on the loan?

Also suppose that your yearly real estate tax is $5700 while the annual insurance is $600. What is the total monthly payment to the bank?

Note: Fin the monthly tax and insurance and add it to the monthly payment.

common rule states that the total payment can not exceed 25% of the buyers gross yearly income. What would be the required annual income to qualify for the loan?

Note: Find total payments per year, including taxes and insurance. From 25% rule, we know that this value must be less than 25% of annual income.

For example, you want to pay an extra $150 per month toward the principal. How long will it take to pay off the loan. Calculate the total interest using this faster payoff, and how much interest will you save with this faster payoff.