SOLUTION: You want to take out a $176,000 mortgage (home loan). The interest rate on the loan is 6.2%, and the loan is for 30 years. Your monthly payments are $1,077.95. How much will still

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Question 1195632: You want to take out a $176,000 mortgage (home loan). The interest rate on the loan is 6.2%, and the loan is for 30 years. Your monthly payments are $1,077.95. How much will still be owed after making payments for 20 years? Round your answer to the nearest dollar.
Found 2 solutions by dezbee2008, MathTherapy:
Answer by dezbee2008(5)   (Show Source): You can put this solution on YOUR website!
You want to take out a $176,000 mortgage (home loan). The interest rate on the loan is 6.2%, and the loan is for 30 years. Your monthly payments are $1,077.95. How much will still be owed after making payments for 20 years? Round your answer to the nearest dollar.
Our first step is to convert this to the Simple Interest equation:
A=P(1+RT)
A is the total accrued amount
P is the principle ($176,000)
R is the rate in decimal form (i.e. move decimal two places to the left, so 6.2% converted into decimal is 0.062)
T is the time in years (or months) (30 years)
The equation becomes A=$176000(1+0.062*30)
Solve the equation using the order of operations:
A=$176000(1+1.86)
A=$176000(2.86)
A=$503360
Your total home loan is $503360. You will use this number for the second part of the question.
Now we move on to the second part of the question.
The monthly payment is $1077.95
Multiply $1077.95 by 12 months will become $12395.40
Multiply $12395.40 by 20 years will become $258708
Finally, subtract $258708 from $503360 and you will reach the answer of $244652
Answer by MathTherapy(10549)   (Show Source): You can put this solution on YOUR website!
You want to take out a $176,000 mortgage (home loan). The interest rate on the loan is 6.2%, and the loan is for 30 years. Your monthly payments are $1,077.95. How much will still be owed after making payments for 20 years? Round your answer to the nearest dollar.
After making the 240th (20-year interval) payment, the mortgage loan balance will be: $96,219.24.

BTW: What the other person did doesn't make any sense. As far as I know, SIMPLE INTEREST is NEVER NORMALLY used for mortgages and many other
loans. Plus, how can one borrow $176,000 and owe almost $250,000 after 20 years? Does that make sense to you, or anyone else? Let's hope not!!
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