Question

The bank is willing loan you money to purchase a home at 1% interest, compounded monthly. If you would like to buy a $300000 house, hwo much would your payments be each month be if you take out a:
10 year mortgage:
20 year mortgage:
30 year mortgage:

Please help!!!

Answer 1

again?

Answer 2

formula is rather complicated and long if you want to do this correctly

Answer 3

derive mortgage formula
\begin{align} & 1 \text{st} \text{Month}\text{ }= P(1+R) -W\\&2 \text{nd} \text{Month}\text{ }=((P(1+R) -W)(1+R))-WP(1+R)^2-W(1+R)-W\\&3\text{rd} \text{Month}=\left(\left(P(1+R)^2-W(1+R)-W\right)(1+R)\right)-W\\&P(1+R)^3-W(1+R)^2-W(1+R)-W \end{align}

Answer 4

\[P(1+R)^N-W\left(-\frac{1-(1+R)^N}{R}\right)=P(1+R)^N+W\frac{\left(1-(1+R)^N\right) }{R}\]

Answer 5

use bottom formula here with r = .01, y = 10

Answer 6

\[W\to \frac{P R (1+R)^N}{-1+(1+R)^N}\]

Answer 7

W= monthly payment
P= principal
R= interest rate
n= number of term

Answer 8

http://www.wolframalpha.com/input/?i=300000%28.01%2F12%29%2F%281-%281%2B.01%2F12%29^%28-120%29%29
i get $2826. for the first one

Answer 9

sorry $2628

Answer 10

@imran, i don't know that formula. i am wondering if it is the same as the one i wrote

Answer 11

which formula did you use?

Answer 12

oops i thought i attached it. bottom one here

Answer 13

I'm sorry for the late reply but I just wanted to say thank you both so very much for your help with the formulas. I just worked on them and you have given me the correct formula! I used satellite's formula but they both helped me . :)