A group of private investors purchased a condominium complex

A group of private investors purchased a condominium complex for $3.5 million. They made an initial down payment of 12% and obtained financing for the balance. The loan is to be amortized over 15 years at an interest rate of 10% per year compounded quarterly. (Round your answers to the nearest cent.) What is the required quarterly payment?

How much total interest will be paid on the loan?

Solution

Number of Durations = 15 years * 4 quarters/1 year = 60

PMT Down = $3,50,0000 * 12/100 = 42,0000$

Interest Rate = 10%

PV = $3,50,0000 - $42,0000 = $3,08,0000

Required Quarter Payment = $99,648.46

Total Interest Paid = $99,648.46 * 60 - $3,08,0000 = $2898907.6