Kim secured a bank loan to purchase a 400000 house She will

Kim secured a bank loan to purchase a $400,000 house. She will make monthly payments for IS years, with an interest rate of 2 1/2 % compounded monthly on the unpaid balance. How much will she owe after making 60 payments?

Solution

payment = P
n = 180 months
i = 0.025/12
400,000 = P( 1 - (1+0.025/12)^-180)/(0.025/12)
P = 2667.1568

balance after 5 years (60 payemnts)
= 400000(1+(0.025/12))^60 - 2667.1568((1+(0.025/12))^60 - 1)/(0.025/12)
=$ 282,927.7223