Question

Vanessa bought a house for $268,500. She has a 30 year mortgage with a fixed rate of 6.25%. Vanessa’s monthly payments are $1,595.85. How much was Vanessa’s down payment?
a.
$9,314.45
b.
$16,781.25
c.
$40,275.00
d.
$53,040.00

Answer 1

Let r = 0.0625/12 = 0.0052083333 (monthly rate), n = 30*12 = 360, M = 1595.85.

Loan principal P = M * (1 - (1+r)^(-n)) / r
Evaluating gives P ≈ $259,185.55.

Down payment = 268,500 − 259,185.55 ≈ $9,314.45.

Answer: a. $9,314.45