Gabby is planning to buy a home.  She has some money for a down payment already saved.  She sees a home she would like and calculates that she would need to borrow $210,000 from a bank for a 30-year period.  The APR is 7.2%. What will be her total interest for the 30 years? How much total interest will Gabby pay with a 15 year mortgage?   Step 1) What is the monthly payment? Step 2) What are the total payments ($) for the entirety of the loan? Step 3) What is the total interest?

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Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.