Asked by Kinsey
You find that the going rate for a home mortgage with a term of 30 years is 6.5% APR. The lending agency says that based on your income, your monthly payment can be at most $750. How much can you borrow?
Answers
Answered by
Henry
P = Po*r*t/(1-(1+r)^-t).
r = 0.065/12mo. = 0.00542/mo. = Monthly % rate.
P = 750/mo. * 360mo. = $270,000.
P = (Po*0.00542*360)/(1-1.00542^-360) = 270,000,
(Po*1.950)/0.8571 = 270,000,
2.275Po = 270,000, Po = $118,675.38.
r = 0.065/12mo. = 0.00542/mo. = Monthly % rate.
P = 750/mo. * 360mo. = $270,000.
P = (Po*0.00542*360)/(1-1.00542^-360) = 270,000,
(Po*1.950)/0.8571 = 270,000,
2.275Po = 270,000, Po = $118,675.38.
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