Answer:
The monthly payment is $ 618.81 ( approx )
Step-by-step explanation:
Here,
The price of house = $ 107,820,
Down payment percentage = 15 %,
So, the down payment = 15 % of $ 107,820
[tex]=\frac{15\times 107820}{100}[/tex]
[tex]=\frac{1617300}{100}[/tex]
= $ 16,173
Thus, the principal amount of loan, P.V. = The price of house - the down payment
= $ 107,820 - $ 16,173
= $ 91647
Now, the annual rate = 6.5 % = 0.065
⇒ The rate per month, r = [tex]\frac{0.065}{12}[/tex]
Time, n = 25 years = 300 months,
Hence, the monthly payment of the loan is,
[tex]P=\frac{P.V.(r)}{1-(1+r)^{-n}}[/tex]
[tex]=\frac{91647(\frac{0.065}{12})}{1-(1+\frac{0.065}{12})^{-300}}[/tex]
[tex]=\$ 618.80710716\approx \$ 618.81[/tex]
