Question

You borrow 125,000 for 25 years at an APR of 6.5%. What will be your monthly payment?

Answer 1

$\bf \qquad \qquad \textit{Amortized Loan Value} \\\\ pymt=P\left[ \cfrac{\frac{r}{n}}{1-\left( 1+ \frac{r}{n}\right)^{-nt}} \right] \\\\\\\\ \qquad \begin{cases} P= \begin{array}{llll} \textit{original amount}\\ \end{array}\to & \begin{array}{llll} 125000 \end{array}\\ pymt=\textit{periodic payments}\\ r=rate\to 6.5\%\to \frac{6.5}{100}\to &0.065\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{APR, meaning once} \end{array}\to &1\\ t=years\to &25 \end{cases}$