Answered

If the interest rate on a 15-year mortgage for $225,000 were changed from 2.9% to 2.6%, how much would you save over the life of the loan?



Answer :

The amount saved when the interest rate is changed will be $10125.

How to calculate the value?

When the interest rate was 2.9%, the amount will be:

= (Principal × Rate × Time) / 100

= (225000 × 2.9 × 15) / 100

= $97875

When the interest rate was 2.6%, the amount will be:

= (Principal × Rate × Time) / 100

= (225000 × 2.6 × 15) / 100

= $87750

Therefore, the amount saved will be:

= $97875 - $87750

= $10125

The amount saved is $10125

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