Question

The price of a home is $148,000. The bank requires a 20% down payment. After the down payment, the balance is financed with a 25-year fixed rate mortgage at
6.8%.

Answer 1

$A=P*\frac{r(1+r)^n}{(1+r)^n-1}$


   A = periodic payment
   P = principal = 80/100 * $ 148,000 = $ 1,18,400
   r = rate of interest per month / 100 = 6.8/12/100 = 0.005666
   n = number of months = 25 * 12= 300

$A = \ 118,400 * \frac{0.005666 *1.005666^{300} } {1.005666^{300}-1}\\\\A= \ 818.40 per\ month$