Here is problem ..make a table of balances at the end of each 12 months for 1st 10 years of the mortgage. Loan was of $150,000 with payback of $1074.64 per month with an interest rate of 6% per year ( .5% per month) . Notes say B=150,000(1.005n) + 1074.64/.005 ( 1 1.005n)
so there are a few things I am confused about before I can do this and I think there is a missing "sign" in the last parenthesis.
1) I get the first part...principal times interest over the n time period ..and that's how much I owe..right
2) but why is the monthly amount paid of 1074.64 divided by the interest rate and why is it added onto the amount owed..if I am looking at the balance wouldn't it be subtracted?
3) and in the last parenthesis should it have a plus sign ?
Any help would be appreciated
so there are a few things I am confused about before I can do this and I think there is a missing "sign" in the last parenthesis.
1) I get the first part...principal times interest over the n time period ..and that's how much I owe..right
2) but why is the monthly amount paid of 1074.64 divided by the interest rate and why is it added onto the amount owed..if I am looking at the balance wouldn't it be subtracted?
3) and in the last parenthesis should it have a plus sign ?
Any help would be appreciated