John Doe has just been offered a home loan towards purchase of house that is being sold for $230,000. He will be required to make a 15% down payment, as well as mortgage processing fees and closing costs of $3,000. The loan has to be paid off in monthly payments over a 30-year period at a fixed interest rate of 4% per year compounded monthly. He will also be required to pay an additional $92 per month as mortgage insurance. Using Excel, answer the following questions: (a) The monthly mortgage payment is $ (enter as a positive number to the nearest dollar) (b) The total monthly payment is $. (enter as a positive number to the nearest dollar) (c) The nominal APR is % (to the nearest 2 decimal places) % (to the nearest 2 decimal places) (d) Over the 30-year period, the total amount of interest paid on the loan is $ The effective APR is (enter as a positive number to the nearest dollar). (e) The interest amount in the month 54 payment is $ (enter as a positive number to the nearest dollar) The principal amount in the month 54 payment is $ (enter as a positive number to the nearest dollar) (f) The balance on the loan immediately after making the payment at the end of month 54 is $ (enter as a positive number to the nearest dollar)
John Doe has just been offered a home loan towards purchase of house that is being sold for $230,000. He will be required to make a 15% down payment, as well as mortgage processing fees and closing costs of $3,000. The loan has to be paid off in monthly payments over a 30-year period at a fixed interest rate of 4% per year compounded monthly. He will also be required to pay an additional $92 per month as mortgage insurance. Using Excel, answer the following questions: (a) The monthly mortgage payment is $ (enter as a positive number to the nearest dollar) (b) The total monthly payment is $. (enter as a positive number to the nearest dollar) (c) The nominal APR is % (to the nearest 2 decimal places) % (to the nearest 2 decimal places) (d) Over the 30-year period, the total amount of interest paid on the loan is $ The effective APR is (enter as a positive number to the nearest dollar). (e) The interest amount in the month 54 payment is $ (enter as a positive number to the nearest dollar) The principal amount in the month 54 payment is $ (enter as a positive number to the nearest dollar) (f) The balance on the loan immediately after making the payment at the end of month 54 is $ (enter as a positive number to the nearest dollar)
Chapter3: Income Sources
Section: Chapter Questions
Problem 41P
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Transcribed Image Text:John Doe has just been offered a home loan towards purchase of house that is being sold for $230,000. He will be required to make a 15% down payment, as well as
mortgage processing fees and closing costs of $3,000. The loan has to be paid off in monthly payments over a 30-year period at a fixed interest rate of 4% per year
compounded monthly. He will also be required to pay an additional $92 per month as mortgage insurance. Using Excel, answer the following questions:
(a) The monthly mortgage payment is $. (enter as a positive number to the nearest dollar)
(b) The total monthly payment is $. (enter as a positive number to the nearest dollar)
(c) The nominal APR is
% (to the nearest 2 decimal places)
The effective APR is
% (to the nearest 2 decimal places)
(d) Over the 30-year period, the total amount of interest paid on the loan is $
(enter as a positive number to the nearest dollar).
(e) The interest amount in the month 54 payment is $
(enter as a positive number to the nearest dollar)
The principal amount in the month 54 payment is $
(f) The balance on the loan immediately after making the payment at the end of month 54 is $
(enter as a positive number to the nearest dollar)
(enter as a positive number to the nearest dollar)
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