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Questions and Answers
What is the value of the house that the doctor buys?
What is the value of the house that the doctor buys?
How much money does the doctor put down as a down payment?
How much money does the doctor put down as a down payment?
What is the interest rate on the mortgage?
What is the interest rate on the mortgage?
How many years will the mortgage be repaid over?
How many years will the mortgage be repaid over?
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How much debt does the doctor pay off in the first year?
How much debt does the doctor pay off in the first year?
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Study Notes
Mortgage Loan Scenario
- A doctor purchases a house worth $380,000 with a $125,000 down payment and a $250,000 mortgage loan.
- The mortgage has an annual interest rate of 7.50% (compounded monthly).
- The loan is to be repaid over 20 years in monthly installments.
- In the first year, the doctor pays off $5,720.22 of the debt.
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Description
A doctor buys a house and takes out a mortgage loan. Calculate how much of the debt the doctor pays off in the first year.
