SOLUTION: You can afford a $900 per month mortgage payment. You've found a 30 year loan at 7% interest. a) How big of a loan can you afford? $ b) How much total money will you pay

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Question 1204002: You can afford a $900 per month mortgage payment. You've found a 30 year loan at 7% interest.
a) How big of a loan can you afford?
$

b) How much total money will you pay the loan company?
$

c) How much of that money is interest?
$

Answer by Theo(13342)   (Show Source): You can put this solution on YOUR website!
you can afford a loan of 135,276.81.

here are the resls from using the calculator at https://arachnoid.com/finance/


your inputs were:
present value = 0
future value = 0
number of time periods = 30 years * 12 = 360 months.
interest rate per time period = 7% per year/ 12 = .583333....% per month
payments are made at the end of each time period.
calculator says present value = 135,276.81.
that's the amount of money you can loan.

you made 360 payments of 900 each for a total of 324,000 over the term of the loan.
interest you paid over the term of the loan = that minus 135,276.81 = 188,723.19.

here are the results from using the calculator.





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