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

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.

Rebecca bought a house in Oshawa and took a $259 000 mortgage amortized by monthly payments over 25 years that is renewable after 5 years. If interest is 4.4% compounded semi-annually, what is the outstanding balance at the end of the five year term? If the mortgage is renewed for a further 5 year term at 3.7% compounded semi-annually, what is the balance after the second 5 year term?

How much interest is paid in total on a 3-year loan for $28 600 (rounded to the nearest dollar)? The interest rate is 8.7% compounded monthly and the payments are monthly.

A $176 000.00 mortgage is to be repaid over a 21-year period by monthly payments rounded up to the next higher $100.00. Interest is 9.44% compounded semi-annually. a) Determine the number of rounded payments required to repay the mortgage. b) Determine the size of the last payment.

What is the size of the final unequal payment of a loan that has 69.47 payments and the equal payment size is $215.64? The interest rate is 3.1% per compounding period.

Honda is selling a 2014 Accord Coupe Ex M for $30 056.90 including freight, PDI and all applicable fees. The lease payment of $382 is due at the beginning of each month. If the interest rate compounded annually is 3.99% and the residual value is $13 200, determine the size of the final lease payment.

Shiva transferred his mortgage of $145 981 from CIBC to BMO for the remaining amortization period at 3.59% compounded semi-annually. He has agreed to pay rounded up payment of $2000 every month. How long will it take Shiva to pay-off his mortgage?

A loan of $10 000.00 is repaid by quarterly payments of $1000.00 each at 12% compounded quarterly. What is the principal repaid by the 11th payment?

A $180 000.00 mortgage is to be amortized by making monthly payments for 22.5 years. Interest is 7.2% compounded semi-annually for a four-year term. a) Compute the size of the monthly payment. b) Determine the balance at the end of the four-year term. c) If the mortgage is renewed for a five-year term at 8.66% compounded semi-annually, what is the size of the monthly payment for the renewal term?

Big Printing Inc. is repaying a loan of $37 300.00 by making payments of $2300.00 at the end of every three months. If interest is 3.5% compounded quarterly, construct an amortization schedule showing the total paid and the total cost of the loan. What is the total interest paid and cost of the loan?

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.

Rebecca bought a house in Oshawa and took a $259 000 mortgage amortized by monthly payments over 25 years that is renewable after 5 years. If interest is 4.4% compounded semi-annually, what is the outstanding balance at the end of the five year term? If the mortgage is renewed for a further 5 year term at 3.7% compounded semi-annually, what is the balance after the second 5 year term?

Kirk had accumulated $975 000 in his RRSP at the age of 55. He converted the RRSP into an RRIF at that time and started withdrawing $5000 at the beginning of each month. If interest is 4.5% compounded monthly, what is the size of his final withdrawal?

A debt of $17 000.00 is repaid by quarterly payments of $1430.00. If interest is 6.12% compounded quarterly, what is the size of the final payment?

Li bought a house in Whitby for $305 000 5 years ago. He financed the house through Scotia Bank with a mortgage of $259 000 amortized over 25 years. Interest for the first 5 years was 4.4% compounded semi-annually and payments were made monthly. At the end of the 5 year term, Li has renewed the mortgage for another 5 years, at 3.7% compounded semi-annually. What is the monthly payment for the second term?

Tom receives pension payments of $6000.00 at the end of every six months from a retirement fund of $90 000.00. The fund earns 8.00% compounded semi-annually. a) How many payments will Tom receive? b) What is the size of the final pension payment?

How much total principal is repaid between the 1st and 7th payment interval of a 4.5-year loan for $4887 at an interest rate of 7.4% compounded monthly and the payments are also monthly. Round your answer to the nearest dollar.

A debt of $43 100.00 is repaid by payments of $3350.00 made at the end of every six months. Interest is 8.4% compounded quarterly. a) What is the number of payments needed to retire the debt? b) What is the cost of the debt for the first five years? c) What is the interest paid in the 11th payment? d) Construct a partial amortization schedule showing details of the first three payments, the last three payments, and totals.

Amanda borrowed $57 800 from BMO to buy a 2014 E-Class Mercedes Sedan at 3.9% compounded monthly. Payments of $2056 are required at the end of every month. Construct a complete amortization schedule in MS Excel showing the details of all payments and the total.

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?