A mortgage balance of $23,960 is to be repaid over a 7-year term by equal monthly payments of 6.8% compounded semiannually. At the request of the mortgagor, the monthly payments were set at $440. How many payments will the mortgagor have to make? What is the size of the last payment? Determine the difference between the total actual amount paid through $440 payments and the total amount required through normal amortization at 6.8% to amortize the mortgage by the contractual monthly payments.
A mortgage balance of $23,960 is to be repaid over a 7-year term by equal monthly payments of 6.8% compounded semiannually. At the request of the mortgagor, the monthly payments were set at $440. How many payments will the mortgagor have to make? What is the size of the last payment? Determine the difference between the total actual amount paid through $440 payments and the total amount required through normal amortization at 6.8% to amortize the mortgage by the contractual monthly payments.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A mortgage balance of $23,960 is to be repaid over a 7-year term by equal monthly payments of 6.8% compounded semiannually. At the request of the mortgagor, the monthly payments were set at $440.
- How many payments will the mortgagor have to make?
- What is the size of the last payment?
- Determine the difference between the total actual amount paid through $440 payments and the total amount required through normal amortization at 6.8% to amortize the mortgage by the contractual monthly payments.
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