If you have a $246,000, 30-year, 5 percent mortgage, how much of your first monthly payment of $1,322.25 would go toward principal?

To calculate how much of your first monthly payment goes toward the principal on a mortgage, we need to split the payment into two parts: the interest and the principal.

The formula for calculating the interest portion of the first payment is:

\[
\text{Interest} = \frac{r}{12} \times P
\]

Where:
- $ P $ is the loan principal ($246,000),
- $ r $ is the annual interest rate (5% or 0.05),
- 12 represents the number of months in a year.

Let's calculate the interest portion first:

\[
\text{Interest} = \frac{0.05}{12} \times 246,000
\]

Now, we can calculate this amount.The interest portion of your first monthly payment is \$1,025.

Now, to find how much goes toward the principal, we subtract the interest from the total monthly payment of \$1,322.25:

\[
\text{Principal} = \text{Monthly Payment} - \text{Interest}
\]

\[
\text{Principal} = 1,322.25 - 1,025
\]

\[
\text{Principal} = 297.25
\]

So, \$297.25 of your first monthly payment goes toward the principal.

Would you like more details or have any questions?

Here are 5 related questions:
1. How does the allocation between principal and interest change over time in a mortgage?
2. What is an amortization schedule, and how does it relate to this calculation?
3. What would happen to your payment if the interest rate were higher or lower?
4. How much total interest would be paid over the life of this mortgage?
5. What happens if you make additional payments toward the principal?

**Tip:** Early in a mortgage, most of your monthly payment goes toward interest, but as time passes, a larger portion is applied to the principal.

Learn how to calculate how much of your first monthly mortgage payment goes toward the principal on a $246,000 loan at a 5% interest rate. This detailed guide walks through the interest and principal breakdown for a 30-year mortgage, using key formulas. Ideal for students and homeowners.

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