Question

You are applying for an 80/20 mortgage to buy a house costing $175,000.

Answer 1

Answer:

The total amount of the mortgage is $ 871879.4

Step-by-step explanation:

Given as :

The cost of house = $ 175,000

The first 80% of mortgage amount = 80% of $ 175,000 = 140,000

The second 20 % of mortgage amount =  20% of $ 175,000 = 35,000

The rate of interest for 80 % mortgage = 4.75 %

The rate of interest for 20 % mortgage = 7.525 %

The time period for both mortgage is 30 years

Let The amount at 80 % mortgage = $A_1$

And The amount at 20 % mortgage = $A_2$

So, From compounded method

$A_1$ = principal × $(1+\dfrac{\textrm rate}{100})^{\textrm time}$

or, $A_1$ = 140,000 × $(1+\dfrac{\textrm 4.75}{100})^{\textrm 30}$

Or,  $A_1$ = 140,000 × $(1.0475)^{30}$

Or,  $A_1$ = 140,000 × 4.02365

Or, $A_1$ = $ 563311

Again

$A_2$ = principal × $(1+\dfrac{\textrm rate}{100})^{\textrm time}$

or, $A_2$ = 35,000 × $(1+\dfrac{\textrm 7.525}{100})^{\textrm 30}$

Or,  $A_2$ = 35,000 × $(1.07525)^{30}$

Or,  $A_2$ = 35,000 × 8.81624

Or, $A_2$ = $ 308568.4

∴ Total amount A =  $A_1$ +  $A_2$

I.e A = $ 563311 + $ 308568.4 = $ 871879.4

Hence The total amount of the mortgage is $ 871879.4  answer

Answer 2

Answer:351,226.80

Step-by-step explanation: