document.write( "Question 1182343: A store was purchased for 725,000 and the buyer made a 10% down payment. The balance was financed with a 6.35% loan for 27 years. Find the monthly payment. \n" ); document.write( "

Algebra.Com's Answer #853570 by ikleyn(53570) $\"\"$ $\"About$

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\n" ); document.write( "A store was purchased for 725,000 and the buyer made a 10% down payment. The balance was financed
\n" ); document.write( "with a 6.35% loan for 27 years. Find the monthly payment.
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\n" ); document.write( "\n" ); document.write( "        The solution in the post by @mananth is INCORRECT.\r
\n" ); document.write( "\n" ); document.write( "        He uses irrelevant methodology, which has no any relation to this problem.\r
\n" ); document.write( "\n" ); document.write( "        I came to provide a correct solution using a standard methodology for this kind loan problems.\r
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document.write( "The loaned amount is  725000 - 0.1*725000 = 652500 dollars.\r\n" );
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document.write( "Use the standard formula for the monthly payment for a loan\r\n" );
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document.write( "    M = \r\n" );
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document.write( "where L is the loan amount;  r is the effective interest rate per month;\r\n" );
document.write( "n is the number of payments (same as the number of months); M is the monthly payment.\r\n" );
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document.write( "In this problem  P = $652,500;  r = ;  n = 12*27 = 324.\r\n" );
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document.write( "Substitute these values into the formula and get for monthly payment\r\n" );
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document.write( "    M =  = $4215.22.\r\n" );
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document.write( "ANSWER.  The monthly payment is $4,215.22.\r\n" );
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\n" ); document.write( "\n" ); document.write( "Solved correctly and explained completely.\r
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