how much money will be spent in interest alone over the course of the 5% 30 - year mortgage described in the…
how much money will be spent in interest alone over the course of the 5% 30 - year mortgage described in the table?\nmortgage payments\nprincipal: $200,000.00\ninterest rate monthly payment\n3% $843\n4% $955\n5% $1074
Answer
Explanation:
Step1: Determine the number of payments
The mortgage is for 30 years and payments are monthly. So the number of payments $n = 30\times12=360$.
Step2: Calculate the total amount paid
The monthly payment at 5% interest rate is $1074$. So the total amount paid over 30 - years is $1074\times360 = 386640$.
Step3: Calculate the interest amount
The principal amount is $200000$. The interest amount $I$ is the total amount paid minus the principal. So $I=386640 - 200000=186640$.
Answer:
$186640$