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11 February, 05:23

7) You put 20% down on a home with a purchase price of $250,000. The down payment is thus $50,000, leaving a balance owed of $200,000. The bank will loan the remaining balance at 3.91% APR. You will make annual payments with a 30-year payment schedule. What is the annual annuity payment under this schedule?

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  1. 11 February, 07:04
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    =$11,439.96 (Approx)

    Explanation:

    Consider the following calculations

    Present value of annuity=Annuity[1 - (1+interest rate) ^-time period]/rate

    200,000=Annuity[1 - (1.0391) ^-30]/0.0391

    200,000=Annuity*17.48257135

    Annuity=200,000/17.48257135

    =$11,439.96 (Approx)
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