Joe Jay purchased a new colonial home for 260000 putting dow

Joe Jay purchased a new colonial home for $260,000, putting down 20%. He decided to use Loyal Bank for his mortgage. They were offering a 6 1/2% for a 25-year mortgage. The principal after the first payment had a balance outstanding of:

Solution

Joe Jay purchased a new colonial home for $260,000, putting down 20%=208000

                          They were offering a 6 1/2% for a 25-year mortgage : 6 1/2%(208000)=13520

   for one year:13520/25=540.80

   total is:208000-540.80

=207459.2