Math 1030

Project 1
Name ___Mariela__Ramirez_______________

Buying a House
Select a house from a real estate booklet, newspaper, or website. Find something reasonable
between $100,000 and $350,000. In reality, a trained financial professional can help you
determine what is reasonable for your financial situation. Take a screen shot of the listing for
your chosen house and attach it to this project. Assume that you will pay the asking price for
your house.
The listed selling price is _____349,900_______.
Assume that you will make a down payment of 20%.
The down payment is _____69,980_______. The amount of the mortgage is
_______279,920.00_____.
Ask at least two lending institutions for the interest rate for both a 15-year and a 30-year fixed
rate mortgage with no points or other variations on the interest rate for the loan.
Name of first lending institution: __________Wells Fargo Bank_________________.
Rate for 15-year mortgage: ____3.25%__.

Rate for 30-year mortgage ___4.25%____.

Name of second lending institution: _____University Credit Union__________.

Rate for 15-year mortgage: _____3.5%___. Rate for 30-year mortgage ______4.5%__.
Assuming that the rates are the only difference between the different lending institutions, find the
monthly payment at the better interest rate for each type of mortgage.
15-year monthly payment: ____________. 30-year monthly payment
_$1377.04_______.
These payments cover only the interest and the principal on the loan. They do not cover the
insurance or taxes.
To organize the information for the amortization of the loan, construct a schedule that keeps
track of: (1) the payment number and/or (2) the month and year (3) the amount of the payment,
(4) the amount of interest paid, (5) the amount of principal paid, and (6) the remaining balance.
There are many programs online available for this including Brett Whissles website:
http://bretwhissel.net/cgi-bin/amortize. A Microsoft Excel worksheet that does is also available
online at http://office.microsoft.com/en-us/templates/loan-amortization-scheduleTC001019777.aspx?CategoryID=CT062100751033.

Its not necessary to show all of the payments in the tables below. Only fill in the payments in
the following schedules. Answer the questions after each table.
15-year mortgage
Payment
Number

Payment
Date

Payment
Amount ($)

Interest
Paid ($)

Principal
Paid ($)

Remaining
Balance ($)

1. . 12/21/16

1,966.91

758.12

1,208.79

278,711.21

2. . 01/21/17

1,966.91

754.84

1,212.07

277,499.14

50. . 02/21/21

1,966.91

583.08

1,383.83

213,906.60

90. . 06/21/24

1,966.91

424.97

1,541.94

155,369.01

120. . 12/21/26

1,966.91

294.64

1,672.27

107,117.01

150. . 05/21/29

1,966.91

158.19

1,808.72

56,600.22

180. . 11/21/31

1,966.91

5.31

1,961.60

total

-------

$0.00. .
---------

Use the proper word or phrase to fill in the blanks.

The total principal paid is the same as the _mortgage_____________________.
The total amount paid is the number of payments times
____180_____________________.
The total interest paid is the total amount paid minus _the principal
paid_______________________.
Use the proper number to fill in the blanks and cross out the improper word
in the parentheses.
Payment number __1___ is the first one in which the principal paid is greater than the
interest paid.
The total amount of interest is $__205,796.12 less___________ (more or less) than the
mortgage.

The total amount of interest is __73.51 less___________% (more or less) than the
mortgage.
The total amount of interest is __26.48___________% of the mortgage.

30-year mortgage
Payment
Number

Payment
Date

Payment
Amount ($)

Interest
Paid ($)

Principal
Paid ($)

Remaining
Balance ($)

1. . 12/21/16

1377.04

991.38

385.65

279,534.35

2. . 01/21/17

1377.04

990.02

387.02

279,147.32

60. . 12/21/21

1377.04

900.25

476.79

253,712.12

120. . 12/21/26

1377.04

787.59

589.45

221,788.05

240. . 12/21/36

1377.04

476.10

900.94

133,526.17

300. . 12/21/41

1377.04

263.20

1113.84

73,201.93

360. . 11/21/46

1377.04

4.86

1372.18

total

-------

215,813.73

$0.00. .
---------

Payment number __240___ is the first one in which the principal paid is greater than the interest
paid.
The total amount of interest is $______64,106.27___less____ (more or less) than the
mortgage.
The total amount of interest is __22.90 less___________% (more or less) than the
mortgage.
The total amount of interest is _77.09____________% of the mortgage.
Suppose you paid an additional $100 a month towards the principal:
The total amount of interest paid with the $100 monthly extra payment would be
$_184,780.26________.
The total amount of interest paid with the $100 monthly extra payment would be
$_31,033.47__________ (more or less) than the interest paid for the scheduled
payments only.
The total amount of interest paid with the $100 monthly extra payment would be __14.37
less_________% (more or less) than the interest paid for the scheduled payments only.

The $100 monthly extra payment would pay off the mortgage in _3___ years and _9___
months; thats __45____ months sooner than paying only the scheduled payments.