1. Annie Oakley is purchasing a home for $215,000. She will finance the mortgage

Question

1. Annie Oakley is purchasing a home for $215,000. She will finance the mortgage for 15 years and pay 7% interest on the loan. She makes a down payment that is 20% of the purchase price.

a. Find the monthly payment, including principal and interest. (5 points)
Answer:

b. Calculate the total interest Annie will pay over the 15 year period. (5 points)
Answer:

c. How much more interest would Annie pay by paying for the home in 30 years rather than 15 years? (5 points)
Answer:

d. The annual taxes on Annie’s property come to $7100, and she pays $535 for insurance each year. Find her monthly PITI payment if she takes a 15 year loan. (5 points
Answer:

Explanation / Answer

Principal = price - down; $215,000 - (20% 0f $215,000) =$172,000
interestRate = (number / 100 ) / 12; (7/100)/12 = .00583 per month or .583%
months = loan.years * 12; 15* 12 = 180 months

payment = (principal * interestRate) / ( 1 - ( 1+interestRate ^ (-1*months) ) ) * 100 ) / 100; Payment = (172000*0.00583)/(1-(1+0.00583 ^(-1*180)))*100)/100
That is: $1545.98 per month
180 months of 1545.98 = 278276.40 total dollars paid
278276.40 - 172000 = 106276.40 in interest paid

The true monthly payment is ( ins + tax) / 12, which is not financed, but included each month
636.25 + 1545.98 = $2182.23 a.The monthly payment, including principal and interest = $1545.98 b.The total interest Annie will pay over the 15 year period = $106,276.40 c. The total more interest Annie will pay over the 30 year period $133437.60 payment = (principal * interestRate) / ( 1 - ( 1+interestRate ^ (-1*months) ) ) * 100 ) / 100; Payment = (172000*0.00583)/(1-(1+0.00583 ^(-1*360)))*100)/100
That is: $1144.32 per month
360 months of $1144.32= $411,955.31 total dollars paid
$411,955.31- 278276.40 = $133,678.91 d.Monthly PITI payment if she takes a 15 year loan.=636.25 + 1545.98 = $2182.23 The true monthly payment is ( insurance + tax) / 12, which is not financed, but included each month
=($7100 + $535)/12 = $636.25 Payment = (172000*0.00583)/(1-(1+0.00583 ^(-1*360)))*100)/100
That is: $1144.32 per month
360 months of $1144.32= $411,955.31 total dollars paid
$411,955.31- 278276.40 = $133,678.91 d.Monthly PITI payment if she takes a 15 year loan.=636.25 + 1545.98 = $2182.23 The true monthly payment is ( insurance + tax) / 12, which is not financed, but included each month
=($7100 + $535)/12 = $636.25

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.