Answer:
- monthly payment: $15,903.61
- interest: $2,368,664.10
Step-by-step explanation:
a) The loan amount is 90% of the price shown, so is ...
0.90 × $2,663,995 = $2,397,595.50
The monthly loan payment is given by the amortization formula:
A = P(r/12)/(1 -(1 +r/12)^(-12t))
A = $2,397,595.50(0.0525/12)/(1 -(1 +0.0525/12)^(-12·30))
A = $13,239.61
The monthly escrow payment will be 1/12 of the annual amount:
0.012 × $2,663,995 / 12 = $2664.00
So, the total monthly payment on the house will be ...
$13,239.61 +2664.00 = $15,903.61
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b) The sum of monthly loan payments is ...
$13,239.61 × 360 = $4,766,259.60
so the interest on the $2,397,595.50 loan is ...
$4,766,259.60 -2,397,595.50 = $2,368,664.10
