Amortizing Loan. You take out a 30-year $100,000 mortgage loan with an APR of 6 percent and monthly payments. In 12 years you decide to sell your house and pay off the mortgage. What is the principal balance on the loan?
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Amortizing Loan. You take out a 30-year $100,000 mortgage loan with an APR of 6 percent and monthly payments. In 12 years you decide to sell your house and pay off the mortgage. What is the principal balance on the loan?
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Solution Summary
Calculations are done by hand, step by step.
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First calculate the EMI for the mortgage.
EMI = Loan amount * interest rate per period/(1-1/(1+interest rate per period)^number of payment periods))
Loan amount = 100000
Interest rate per period = 6%/12 = ...
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