10.5 Buying a House With a Mortgage 633 Then, to determine the monthly principal and interest payment, multiply the number of thousands of dollars of mortgage, 211.65, by the value found in Table 10.4, $4.77415. 211.65 $4.77415 $1010.45 × ≈ Thus, the monthly principal and interest payment is $1010.45. To this amount, we add the monthly property taxes, $165, and the monthly homeowners’ insurance, $115. $1010.45 $165 $115 $1290.45 + + = Therefore, the Martins’ total monthly mortgage payment is $1290.45. c) In part (a), we determined that 28% of the Martins’ adjusted monthly income is $1905.40. In part (b), we determined that the Martins’ total monthly house payment is $1290.45. Because their total monthly house payment is less than or equal to 28% of their adjusted monthly income, the Martins would most likely qualify for the mortgage. 7 Now try Exercise 23 Mortgage Calculator Number of Years Rate % 10 15 20 25 30 3.0 $9.65607 $6.90582 $5.54598 $4.74211 $4.21604 3.5 9.88859 7.14883 5.79960 5.00624 4.49045 4.0 10.12451 7.39688 6.05980 5.27837 4.77415 4.5 10.36384 7.64993 6.32649 5.55832 5.06685 5.0 10.60655 7.90794 6.59956 5.84590 5.36822 5.5 10.85263 8.17083 6.87887 6.14087 5.67789 6.0 11.10205 8.43857 7.16431 6.44301 5.99551 6.5 11.35480 8.71107 7.45573 6.75207 6.32068 7.0 11.61085 8.98828 7.75299 7.06779 6.65302 7.5 11.87018 9.27012 8.05593 7.38991 6.99215 8.0 12.13276 9.55652 8.36440 7.71816 7.33765 8.5 12.39857 9.84740 8.67823 8.05227 7.68913 9.0 12.66758 10.14267 8.99726 8.39196 8.04623 9.5 12.93976 10.44225 9.32131 8.73697 8.40854 10.0 13.21507 10.74605 9.65022 9.08701 8.77572 10.5 13.49350 11.05399 9.98380 9.44182 9.14739 11.0 13.77500 11.36597 10.32188 9.80113 9.52323 Table 10.4 Monthly Principal and Interest Payment per $1000 of Mortgage Learning Catalytics Keyword: Angel-SOM-10.5 (See Preface for additional details.) In Example 2 we used Table 10.4 to calculate the monthly principal and interest payment on a mortgage. We may also use a formula to calculate this payment. The formula is virtually the same one we used in Section 10.4 to calculate installment payments. We will now restate this formula and use it to calculate the monthly principal and interest payments on a mortgage. Principal and Interest Payment Formula m p r n r n 1 1 n t ( ) = ⎛ ⎝ ⎞ ⎠ − ⎛ + ⎝ ⎞ ⎠ − ⋅ (Continued)
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