Question

If the purchase price for a house is $445,500, what is the monthly payment if you put 5% down for a 30 year loan with a fixed rate of 6.25%? a. $2,740.19 b. $2,605.87 c. $1,314.84 d. $1,249.10 please select the best answer from the choices provided a b c d

Answer 1

The monthly payment if we put 5% down for a 30-year loan with a fixed rate of 6.25% is (B) $2,605.87 (approx).

What is a loan?

• A loan is the lending of money by one or more individuals, organizations, or other entities to other individuals, organizations, or other entities in finance.
• The recipient (i.e., the borrower) incurs a debt and is typically required to pay interest on that debt until it is repaid, in addition to repaying the principal amount borrowed.
• The document evidencing the debt will typically include information such as the principal amount borrowed, the interest rate charged by the lender, and the date of repayment.
• A loan is the temporary reallocation of the subject assets between the lender and the borrower.

To find the monthly payment if we put 5% down for a 30-year loan with a fixed rate of 6.25%:

• The purchase price is = $445500
• 5% is down payment = 0.05 × 445500 = 22275
• Loan amount is = 445500 - 22275 = 423225
• The EMI formula is = [p × r (1+r)ⁿ]/[(1+r)ⁿ-1]
• p = 423225
• r = 6.25/12/100=0.0052
• n = 30 × 12 = 360
• Putting the values in the formula we get:
• [423225 × 0.0052 × (1.0052)³⁶⁰]/[(1.0052)³⁶⁰-1]
• = $2603.17

Therefore, the monthly payment if we put 5% down for a 30-year loan with a fixed rate of 6.25% is (B) $2,605.87 (approx).

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The correct question is given below:
If the purchase price for a house is $445,500, what is the monthly payment if you put 5% down for a 30-year loan with a fixed rate of 6.25%?

a. $2,740.19

b. $2,605.87

c. $1,314.84

d. $1,249.10