Exam 14: Amortization of Loans, Residential Mortgages, and Sinking Funds

What is the monthly payment size of a 25-year mortgage for $100 000 and an interest rate of 6% compounded semi-annually?

Cody borrowed $9100.00 from his credit union. He agreed to repay the loan by making equal monthly payments for 4 years. Interest is 9% compounded monthly. a) What is the size of the monthly payments? b) How much will the loan cost him? c) How much will Cody owe after 16 months? d) How much interest will he pay in his 26th payment? e) How much of the principal will be repaid in the 18th payment? f) Prepare a partial amortization schedule showing details of the first three payments, Payments 24, 25, 26, the last three payments, and totals.

Duguid and Partners bought a property valued at $87 300.00 for $17 000.00 down and a mortgage amortized over 17 years. The firm makes equal payments due at the end of every three months. Interest on the mortgage is 6.85% compounded annually and the mortgage is renewable after five years. a) What is the size of each quarterly payment? b) What is the outstanding principal at the end of the five-year term? c) What is the cost of the mortgage for the first five years? d) If the mortgage is renewed for a further five years at 7.17% compounded semi-annually, what will be the size of each quarterly payment?

Andre has saved $152 000.00. If he withdraws $1750.00 at the beginning of every month and interest is 7.5% compounded monthly, what is the size of the last withdrawal?

The Taylors agreed to monthly payments rounded up to the nearest $100.00 on a mortgage of $136 000.00 amortized over 15 years. Interest for the first five years was 8.5% compounded semi-annually. After 30 months, as permitted by the mortgage agreement, the Taylors increased the rounded monthly payment by 10%. a) Determine the mortgage balance at the end of the five-year term. b) If the interest rate remains unchanged over the remaining term, how many more of the increased payments will amortize the mortgage balance? c) How much did the Taylors save by exercising the increase-in-payment option?

What is the monthly payment size of a 21-year mortgage for $169 600 and an interest rate of 7.2% compounded semi-annually?

Payments of $1000.00 deferred for nine years are received at the end of each month from a fund of $20 000.00 deposited today at 6% compounded monthly. Calculate the size of the final payment.

How much total interest is paid between the 6th and 13th payments on a loan that has monthly payments for 3 years and an original principal of $14 750? The loan rate is 6.6% compounded quarterly.

What is the size of the final unequal payment of a loan for $2723.44 if it has quarterly payments of $500? The interest rate is 8.4% compounded quarterly.

A contract worth $59 000.00 provides benefits of $21 000.00 at the end of each year. The benefits are deferred for six years and interest is 8.95% compounded quarterly. a) How many payments are to be made under the contract? b) What is the size of the last benefit payment?

A debt of $12 500.00 with interest at 5.5% compounded semi-annually is amortized by making payments of $1000.00 at the end of every six months. Calculate the outstanding balance after five years.

A debt of $42 500.00 is repaid by payments of $4850.00 made at the end of each year. Interest is 7% compounded semi-annually. a) How many payments are needed to repay the debt? b) What is the cost of the debt for the first three years? c) What is the principal repaid in the 3rd year? d) Construct an amortization schedule showing details of the first three payments, the last three payments, and totals.

How much principal is repaid in the 74th payment interval on a $142 300 mortgage? The mortgage is amortized over 25 years and the payments are monthly. The interest rate is 7.44% compounded monthly.

A demand (variable rate) mortgage of $137 000.00 is amortized over 20 years by equal monthly payments. After 21 months the original interest rate of 6% p.a was raised to 6.6% p.a. Three years after the mortgage was taken out, it was renewed at the request for the mortgagor for a five-year term at a fixed rate of 7.25% p.a. a) Calculate the mortgage balance after 21 months. b) Compute the size of the new monthly payment at the 6.6% rate of interest. c) Determine the mortgage balance at the end of the five-year term.

The Acme Parts Company is repaying a debt of $15 000.00 by payments of $1410.00 made at the end of every three months. Interest is 7.2% compounded monthly. a) How many payments are needed to repay the debt? b) What is the size of the final payment?

The Acme Parts Company is repaying a debt of $15 000.00 by payments of $1410.00 made at the end of every three months. Interest is 7.2% compounded monthly. a) How many payments are needed to repay the debt? b) What is the size of the final payment?

Karen receives pension payments of $4570.00 at the end of every six months from a retirement fund of $82 000.00. The fund earns 8.06% compounded semi-annually. a) How many payments will Karen receive? b) What is the size of the final pension payment?

A $151 000.00 mortgage is to be repaid over a 17-year period by monthly payments rounded up to the next higher $50.00. Interest is 8.2% compounded semi-annually. a) Determine the number of rounded payments required to repay the mortgage. b) Determine the size of the last payment. c) Calculate the amount of interest saved by rounding the payments up to the next higher $50.00.

How much interest is paid in total on a 1-year loan for $5000? The interest rate is 12 % compounded monthly and the payments are monthly.

Catrina receives payments of $1120.00 at the beginning of each month from a pension fund of $79 500.00. Interest earned by the fund is 11.36% compounded monthly. a) What is the number of payments Catrina will receive? b) What is the size of the final payment?