Part A) To calculate the interest paid over 15 years, we first need to calculate the annual interest payment. We can use the formula:
Annual interest payment = Loan amount x Interest rate
Annual interest payment = $150,000 x 0.0275
Annual interest payment = $4,125
So, over 15 years, the total interest paid will be:
Total interest paid = Annual interest payment x Number of years
Total interest paid = $4,125 x 15
Total interest paid = $61,875
Part B) To calculate the total amount paid when she pays off her mortgage, we need to add the total interest paid to the loan amount:
Total amount paid = Loan amount + Total interest paid
Total amount paid = $150,000 + $61,875
Total amount paid = $211,875
Therefore, when Rosario pays off her mortgage in 15 years, she will have spent a total of $211,875.
Rosario was able to get a great interest rate on her house. She financed $150,000 for 15 years with an interest rate of 2.75%.
Part A) How much will she pay in interest over 15 years?
Part B) When she pays of her mortgage, how much will she have spent in all?
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