Question

Will give medal and fan....


Shannon finances $189,000 with a 20/7 balloon mortgage at 6.25%. How much will she pay for principal and interest over the life of the loan?

$261,951.94

$264,100.53

$266,751.42

$497,322.00


I keep getting 190,383.66... I am not sure what I am doing wrong.

Answer 1

I am using the formula P[((i(1+i)^((n)(t)))/((1+i)^((n)(t))-1)].... where P= 189,000 i= .0625/12 n=12 t=20

Answer 2

@amistre64 can you please help me? (:

Answer 3

add up all the payments right?

Answer 4

7 years of payments, plus the remaining amount after 7 years for a balloon payment

Answer 5

you have a 20 year fixed loan, for 7 years ... add up the payments

after the 7 years is up, there is an amount left on the loan that gets paid off ..

Answer 6

7*12 payments of 1381.45 each

+ a remaining balance of 147,292

Answer 7

So, for 7 years there would be no interested added? Then after those 7 years are up you would then have a fixed interest rate for 20 years... and you solve for the 7 years then you solve for the 20 years separately then add the total of those two together?

Answer 8

interest is always applied to a house loan unless told other wise

the total number of payments is the total cost of the loan .. principal + interest

Answer 9

if you know the monthly payments on a 20 yr fixed loan ... then after 7 years youve made how much in payments?

the loan is to be paid in full after 7 years, so we need to determine the remaining balance of the loan after 7 years to make a 1 time payment of ....

Answer 10

\[(7*12)*P~+~Bk^{7*12}-P\frac{1-k^{7*12}}{1-k}\]

Answer 11

factoring out a P if you want to simplify it and such ....\[Bk^{84}+P~(84-\frac{1-k^{84}}{1-k})\]

Answer 12

im getting 263,334 but am prolly being too precise so id go with the 264 option

Answer 13

Yes that is what I got as well... was 263,334... it was taking me a while while to respond because I was checking my work xp

Answer 14

Thank you so much for your help (:

Answer 15

youre welcome