From the information given, the total interest payable on the mortgage is 290, 659.84 See the calculation and analysis below.
<h3>What is the calculation on the above mortgage scenario?</h3>
We are given
Vacation Home purchase amount = $250,000
Down payment = 20% i.e. $235,000 X 20% = $50,000
Loan Amount = $250,000 - $50,000
Rate = 7%
Period = 22 years = 22 x 12 = 264 monthly installment
Monthly installment = $1,858.56 (See attached spread sheet).
Recall that Total interest paid
= Monthly Installment X N - Principle loan amount
Hence,
1,858.56 x 264 - 200,000
= 490,659.84 - 200,000
Total interest paid = 290, 659.84
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