Need help with part C: 1. Annie Oakley is purchasing a home for $215,000. She wi

Question

Need help with part C:

1. Annie Oakley is purchasing a home for $215,000. She will finance the mortgage for 15 years and pay 4.25% 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.

Answer: payment = (principal * interestRate) / ( 1 - ( 1 interestRate ^ (-1*months) ) ) * 100 ) / 100; Monthley Payment: $1545.98 per month

b. Calculate the total interest Annie will pay over the 15 year period.

Answer: 180 months of 1545.98 = 278276.40 total dollars paid 278276.40 - 172000 = 106276.40 in interest paid

c. How much more interest would Annie pay by paying for the home in 30 years rather than 15 years?

Answer:

Explanation / Answer

f she is paying 20% down she is financing $172,000. Consulting a mortgage calculator she would pay $411,955.31 on the 30 year and $278,277.23 on the 15 year, so she would pay $133,678.08 more interest.

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