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## Math 1050 Mortgage Project

Due date:

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In this project we will examine a home loan or mortgage. Assume that you have found a home for sale and have agreed to a purchase price of\$1981500.

I)own Payment: Assurne that you are going to make alUYo down payment on the house. Determine the amount of your downpayment and the balance to finance.

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Part I: 30 yea{ Mortgaee Monthly Payment: Calculate the montlly payment for a 30 year loan (rounding up to the nearest cent) by using the following formula. Showyour work. [PMT is the montbh,loan and fayment, P is the ugo@Agq34ggl4J, r is the the For the 30 year loan use an annual interest rate

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MonthlyPaymentfora3Oyearmortgage:

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Note that this monthly payment covers only the interest and the principal on ttre loan. rvu' re It swr does not uva cover any insurance or taxes on the property.

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Amortization Schedule: In order to summarize all the information regarding the amortization of
a loan, construct a schedule that keeps hack of the payment number, the principat paid, the

interest, and the unpaid balance. A spreadsheet program is an excellent tool to develop an amortization schedule. We can use a free amortization spreadsheet on the web. The web address is: http:l/www.bretwhissel.net/amortization/arnortize.html. Enter the amount of the loan, i.e. the selling price minus the down payment, the interest rate, and the appropriate number of years. Check the box to show the schedule. If you are making extra payments towards the principal, include it in the monthly payment and leave the number of payments box blank.

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