Question

question 3
banks make a lot of money by giving out loans. in fact, just take a look at the first month. how much interest will you pay to the bank on the first month for a house that costs $400,000 at 7% for 30 years?

question 4
one way to save big on a loan is to have a high credit score and get a lower interest rate. how much interest would you save on a $400,000 loan if it were 6% instead of 7% interest?

Explanation:

Calculate first month interest for Question 3

Using the Mortgage Interest Calculation knowledge point

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Calculate monthly payment for Question 3

Using the Amortization Formula knowledge point

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Calculate total interest paid over 30 years at 7%

Using the Amortization Formula knowledge point

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Calculate total interest paid over 30 years at 6%

Using the Amortization Formula knowledge point

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Calculate total interest savings for Question 4

Using the Loan Interest Savings knowledge point

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Answer:

Question 3

The interest paid to the bank on the first month is \(2,333.33\) dollars.

Question 4

The total interest saved over the life of the loan is \(94,683.60\) dollars.