Question

Rahm took out a 25-year loan for $155,000 at an APR of 4.8%, compounded monthly, and he is making monthly payments of $888.15. What will his balance be with 17 years left on the loan?

Answer 1

Answer:

$198779.46

Step-by-step explanation:

We must determine the amount owed for the first 7 years. The monthly compound interest formula is:

$A=P(1+r/12)^1^2^t-Xnt$

$A=155000(1+0.048/12)^84-888.15$

$A=216752.23-74604.6$

$A=142147.63$

The balance will be $85690.81 after 7 years of paying

He will still have to pay:

$A=142147.63(1+0.048/12)^8^4=198779.46$

He will have to pay $198779.46 for the last 17 years

Answer 2

Answer:

$123,692.61

Step-by-step explanation: