Answer:
Total payback for Loan type 1 = $354,625.20
Total payback for Loan type 2 = $278,618.40
Explanation
Total payback of a loan consists of the summation of the amount of mortgage to be paid and total interest to be paid after the given number of years.
Total payback of a loan can also be calculated by multiplying your monthly payment of the loan by the total number of months given for payment.
a. For Loan type 1
In the question we have been given or monthly payment = $985.07
The formula for Total payback for Loan type 1 = Monthly payment × number of months
Numbers of years for payment of loan = 30 years
1 years = 12 months
Hence,
Number of months = 30 years × 12 months
Number of months = 360 months
Total payback of loan = $985.07 × 360 months
= $354,625.20
b. For Loan type 2
In the question we have been given or monthly payment = $1160.91
The formula for Total payback for Loan type 1 = Monthly payment × number of months
Numbers of years for payment of loan = 30 years
1 years = 12 months
Hence,
Number of months = 20 years × 12 months
Number of months = 240 months
Total payback of loan = $1160.91 × 240 months
= $278,618.4
Step-by-step explanation:
