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

Question

Need help with part D:

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:

payment = (principal * interestRate) / ( 1 - ( 1 interestRate ^ (-1*months) ) ) * 100 ) / 100; That is: $1545.98 per month 180 months of 1545.98 = 278,276.40 total dollars paid 278,276.40 %u2013 172,000 = 106,276.40 in interest paid

d. The annual taxes on Annie%u2019s property come to $7100, and she pays $535 for insurance each year. Find her monthly PITI payment if she takes a 15 year loan.

Answer:

Explanation / Answer

principal = price - down; interestRate = (number / 100 ) / 12; months = loan.years * 12; payment = (principal * interestRate) / ( 1 - ( 1+interestRate ^ (-1*months) ) ) * 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

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