Asked by
Catrina Yacoub
on Dec 09, 2024
Verified
You have a 25-year $400,000 mortgage with a 3.5% rate of interest (compounded monthly) that you make monthly payments on. What is the balance of the loan at the end of year 15?
A) $202,506
B) $204,506
C) $206,506
D) $208,506
E) $210,506
Compounded Monthly
Determining interest on a monthly schedule by including both the initial principal and previously earned interest in the calculation.
Mortgage
A loan secured by real property, typically a residential property, where the borrower is obliged to pay back with a predetermined set of payments.
Loan Balance
The amount of money that remains to be paid back on a loan at any given time, excluding future interest.
- Master the key elements of loan procurement and the structures for loan repayment, with a focus on the repercussions of interest rates.
Verified Answer
EA
Learning Objectives
- Master the key elements of loan procurement and the structures for loan repayment, with a focus on the repercussions of interest rates.