Mary and Sally want to buy a home that requires an $85,000 mortgage. Monthly payments for a 30-year mortgage are $605 and $772 for a 15-year mortgage. How much more would Mary and Sally pay with the 30-year mortgage?

Mary and Sally want to buy a home that requires an $85,000 mortgage. Monthly payments for a 30-year mortgage are $605 and $772 for a 15-year mortgage. How much more would Mary and Sally pay with the 30-year mortgage?

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter27: Time Value Of Money (compound)

Section: Chapter Questions

Problem 8E

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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

Mary and Sally want to
buy a home that requires an $85,000
mortgage. Monthly payments for a 30-year
mortgage are $605 and $772 for a 15-year
mortgage. How much more would Mary and
Sally pay with the 30-year mortgage?

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