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20 July, 21:11

Lloyd and Jean are considering purchasing a home requiring a $75,000 mortgage. The payment on a 30-year mortgage for this amount is $498.97. The payment for a 15-year maturity is $674.12. What is the difference in the total interest paid between the two different maturities

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  1. 20 July, 22:53
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    amount of mortgage = $75,000

    monthly installment for the 30 years = $498.97.

    difference = total payment - the amount of mortgage = (30 * 12 * $498.97) - $75,000 = $ 104629.2

    for the second,

    (15 * 12 * $674.12) - $ 75 000 = $ 46341.6

    the difference in the total interest paid between the two different maturities = $ 104629.2 - $ 46341.6 = $ 58287.6
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