Question 1161374: 1) A young couple take out a 30-year home mortgage of $146,000.00 at 7.6% compounded monthly. They make their regular monthly payment for 6 years, then decide to up their monthly payment to $1,350.00.
a) What is the regular monthly payment? $
b) What is the unpaid balance when they begin paying the accelerated monthly payment of $1,350.00? $
c) How many monthly payment of $1,350.00 will it take to pay off the loan?
payments
d) How much interest will this couple save? $
Answer by Theo(13342)   (Show Source):
You can put this solution on YOUR website! i did this two ways and got two answers, but the answers were very close to each other and i wasn't able to figure out which one was correct, so i'll give you both.
first was by my own analysis using financial formulas from excel.
second was analysis using online calculators from the web.
here's what i found.
a) What is the regular monthly payment?
excel web
1030.869118 1030.87
b) What is the unpaid balance when they begin paying the accelerated monthly payment of $1,350.00?
excel web
136,349.83 136,349.77
c) How many monthly payment of $1,350.00 will it take to pay off the loan?
excel web
161.6767018 161 + partial payment
that's 161 months of 1350 each plus the last month is a partial payment to finish off the remaining balance.
if you said 161 you would be right, but you could say 162 to finish paying off the complete loan, even though the last month payment is not 1350, but something less.
d) How much interest will this couple save?
excel web
$78,626.76 78,625.37
the difference is very small, but it's there.
i traced the discrepancy to the partial payment from the financial formulas versus the partial payment from the web.
unfortunately, i haven't been able to discover exactly why they're different.
so.......,
take your pick.
the savings are either 78,626.76 or 78,625.37
i tend to think the 78,625.37 may be more accurate, give or take a few pennies.
if that's close enough, yoou should be fine.
if the answer you are looking for is not either one of these, let me know what the answer is that you are looking for and i'll try to duplicate it.
either way, the answers i provided you should be very close to the actual answer.
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