75,000 fixed rate mortgage 30 years @ 5%. What will the principal balance be after 4 regular payments and a 1 time $100 principal payment

Question

the principal and interest payment is 402.62

Answer 1

This appears that most of the work is done for us. If our first known is the interest and principle payment of 402.62 then we can multiply that by the term of the loan in months 30x12=360. This gives us the chance to multiply the payment by the term in months to get the full value of the loan. 402.62x360=144,943.20. Now we can subtract the amount of the original to see what the full amount of interest is 114,943.20 - 75,000 = 69,943.20. We can use this total interest divided by the length of the loan in months (360) to see how much of the monthly payment goes to interest. 69,943.20/360 = 194.28 is our monthly interest payment. Lets subtract this from our full payment to see how much goes to principle each month 402.62-194.28 = 208.34 now lets multiply by four payments to get 833.36 plus 100 extra principle payment to have 933.36. Lets subtract that from the principle 75,000-933.36 = 74,066.64 as our ending balance.