A family borrowed 78000 to buy a house The loan was at 76 an

A family borrowed $78,000 to buy a house. The loan was at 7.6% and for 25 years. The monthly payments were $581.50 each. (See Example 6.) (a) How much of the first month\'s payment was interest, and how much was principal?

Solution

Monthly Payment= 581.50

Monthly Interest rate=7.6%/12=0.076/12

first month interest = 78000 x0.076/12=$494

principal = payment - intterest=581.50-494=$87.5