Mortgage Calc: Calculate Payment, Owed & Interest Breakdown

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SUMMARY

The discussion focuses on calculating mortgage payments for a $1,000,000 home purchase with a $60,000 down payment, utilizing a closed 5-year term and a 25-year amortization at an interest rate of 2.75% compounded semi-annually. The inclusion of a 3.10% mortgage insurance premium is also addressed. Key calculations include determining the monthly payment, the total owed at the end of the 5-year term, and the breakdown of interest versus principal payments over the term.

PREREQUISITES
  • Understanding of mortgage calculations
  • Familiarity with amortization schedules
  • Knowledge of interest compounding methods
  • Ability to use financial formulas for payment calculations
NEXT STEPS
  • Research how to calculate monthly mortgage payments using the formula for fixed-rate mortgages
  • Learn about amortization schedules and how to interpret them
  • Explore the impact of mortgage insurance premiums on overall payment calculations
  • Investigate the differences between closed and open mortgage terms
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Homebuyers, real estate investors, financial students, and anyone interested in understanding mortgage payment calculations and financial planning for home purchases.

penelopedelmar
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Hi I need help with this review question for a class I missed.

A home you want to purchase is priced at $1,000,000. You have $60,000 available for a cash down payment. You borrow the remainder through a mortgage with a closed 5-year term and 25-year amortization at an interest rate of 2.75% compounded semi-annually.
1. What is the monthly payment with a 3.10% mortgage insurance premium?
2. How much will you owe at the end of 5-year term?
3. What percentage of the total 60 payments will be interest and what fraction will have gone towards paying down principal?
 
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