Question

Brian Burkhardt is planning to purchase a home and expects to borrow $291,400 as a mortgage. He can get a 30-year mortgage at a rate of 4.10%, and his monthly payments will be:

Answer 1

Brian Burkhardt's monthly payments for this mortgage would be equal to $1,423.92.

How to calculate monthly payment?

Mathematically, the monthly payment for a mortgage can be calculated by using this formula:

$M=P(\frac{r}{1-(1+r)^{-nt}} )$

Where:

• P is the principal.

• r is the interest rate.

• M is the monthly payment.

• t is the time in years.

• n is the number of times it's compounded.

Note: r = 4.10 = 0.041/12 = 0.0034

Substituting the given parameters into the formula, we have;

$M=291400(\frac{0.0034}{1-(1+0.0034)^{-12\times 30}} )\\\\M=291400(\frac{0.0034}{1-0.3402} )\\\\M=291400(\frac{0.0034}{0.6598} )\\\\M=291400 \times 0.004887$

M = $1,423.92.

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