Question

Joe Jay purchased a new colonial home for $260,000, putting down 20%. He decided to use Loyal Bank for his mortgage. They were offering a 6 1/2% for a 25-year mortgage. The principal after the first payment had a balance outstanding of:

Answer 1

So, Joe Jay is borrowing money to buy the $260,000 house, but he's already paid for 20% of the total; this means he still has 208,000 left to pay.
I'm not sure what Jay would pay as his first payment, but the amount outstanding should just be $208,000 - the first payment amount.