Victor earns a gross annual income of $84,482 and is buying a home for $185,500. he is making a 15% down payment and financing the rest with a 25-year loan at 4.25% interest.

a) what is the mortgage amount he will borrow? (show your work)

b) what will his monthly mortgage payment be? round your answer to the nearest cent. (show your work)

a) The mortgage amount he will borrow  $ 157675

b) Monthly mortgage payment = $854.125

Step-by-step explanation:

a) What is the mortgage amount he will borrow?

Since Victor has made 15 % down payment so the amount left will be the amount he has to borrow

Down payment = 15 % of $185,500

                           = (15 / 100) * 185500

                             = $ 27285

Amount left to be paid = $185,500 - $ 27285

                                     = $ 157675

So, the mortgage amount he will borrow = Amount left to be paid =

$ 157675

b) What will his monthly mortgage payment be?

He is financing with 25-year loan at 4.25% interest

No of thousands in $ 157675 = 157675 / 1000

                                                 = 157.675

(because in table we have given monthly mortgage payment per $1000 borrowed)

From the table monthly mortgage payment per $1000 borrowed for 4.25 % interest rate and 25 year plan is 5.417

Monthly payment for $157675 = 157.675 * 5.417

                                                    = $854.125

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