FinancingInterest_and_payment_calculationsHARD
A $200,000 fixed-rate mortgage has a monthly principal-and-interest payment of $1,199. If the borrower makes that payment for all 360 months, approximately how much total interest will be paid over the life of the loan?
Correct Answer
C) $231,640
Step 1: Total paid over the term = $1,199 × 360 = $431,640. Step 2: Total interest = $431,640 − $200,000 principal = $231,640. Therefore, the borrower would pay about $231,640 in total interest.
Answer Options
A
$431,640B
$199,000C
$231,640D
$631,640Why This Is the Correct Answer
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Deep Analysis of This Financing Question
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Related Topics & Key Terms
Key Terms:
total_interestloan_termmonthly_paymentamortized_loan
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