determine the total they will pay for the house

Laura and Martin obtain a 30​-year, ​$130 comma 000 conventional mortgage at 10.5​% on a house selling for ​$170 comma 000. Their monthly mortgage​ payment, including principal and​ interest, is ​$1189.50.

To determine the total amount Laura and Martin will pay for the house over the course of their mortgage, we need to calculate the total amount they will pay through monthly payments for the full term of the loan.

Given the information:
- Mortgage amount = $130,000
- Interest rate = 10.5% annually
- Loan term = 30 years
- Monthly payment = $1,189.50

### Step-by-step solution:

1. **Number of monthly payments**:  
   Since the loan term is 30 years, and they make monthly payments, the total number of payments is:
   \[
   \text{Number of payments} = 30 \times 12 = 360 \text{ payments}
   \]

2. **Total paid over 30 years**:  
   To find the total amount paid over the life of the loan, multiply the monthly payment by the total number of payments:
   \[
   \text{Total paid} = 1,189.50 \times 360
   \]
   
Let me calculate that.The total amount Laura and Martin will pay for the house over 30 years is **$428,220**.

Would you like more details or have any questions about the calculation? Here are 5 related questions to consider:

1. How much of the total payment goes toward interest vs. principal?
2. How would their total payment change with a lower interest rate?
3. What would be their total payment if the loan term were 15 years instead of 30 years?
4. How much equity will they have in the house after 10 years of payments?
5. What would their monthly payment be if they made a larger down payment?

**Tip**: Over long mortgage terms, you often pay significantly more in interest than the original loan amount. Refinancing at a lower rate could save money!

Determine the total they will pay for the house. Laura and Martin obtain a 30-year, $130,000 conventional mortgage at 10.5% on a house selling for $170,000. Their monthly mortgage payment, including principal and interest, is $1,189.50.

Learn how to calculate the total payment for a 30-year mortgage with a loan amount of $130,000 at an interest rate of 10.5%. This problem explains key concepts such as interest calculation, loan amortization, and the time value of money. Suitable for high school students.

Math Problem Statement

Solution

Ask a new question for Free

By Image

Math Problem Analysis

Mathematical Concepts

Formulas

Theorems

Suitable Grade Level

Related Recommendation