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Math Help - can you help me with finance math?

  1. #1
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    can you help me with finance math?

    I have a mortgage of $40.000. The term of duration is of 25 years, being applied interest rate of annual 12.5% being accumulated to the balance of debt nonamortized. The value of each quota is of $ 436. With these data they ask to me to calculate the paid amount of the interest during the first three month.
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  2. #2
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    hope this can help

    N=3
    I%=12.5/4
    lond=-40000
    repay each time (in your case 3 month)=436
    Final amount needs to pay by end of 3 month = 42519.11

    so the interest chared is 2519.11 for 3 month
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  3. #3
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    Quote Originally Posted by thechineseguy View Post
    N=3
    I%=12.5/4
    lond=-40000
    repay each time (in your case 3 month)=436
    Final amount needs to pay by end of 3 month = 42519.11

    so the interest chared is 2519.11 for 3 month
    You shouldn't post replies to a thread that has been flagged as a double post. Replies should be posted at the original thread, which is here: http://www.mathhelpforum.com/math-he...ance-math.html.

    Threads now merges. CB
    Last edited by CaptainBlack; November 8th 2008 at 07:49 AM.
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  4. #4
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    Quote Originally Posted by gusty View Post
    I have a mortgage of $40.000. The term of duration is 25 years, being applied interest rate of annual 12.5% being accumulated to the balance of debt nonamortized. The value of each quota is $ 436. With these data they ask to me to calculate the paid amount of the interest during the firs three months
    The interest rate for monthly repayments is 12.5/12% (there are other ways of computing this depending on exactly what is mean by the annualy interest rate, but this is a common way).

    Put

    r=(12.5/12)/100 \approx 0.01042

    Then after one month the remaing debt is:

    p_1=40000 (1+r)-436=39980.8

    after two month:

    p_2=p_1 (1+r)-436=39961.4

    after three month:

    p_3=p_2 (1+r)-436=39941.8

    So you have paid off 40000-39941.8=58.2 dollars all the rest of the payments were for interest.

    CB
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