Loan information
30 YEAR*
Interest Rate: 4% = .04 Monthly Mortgage Payment: pymt = $169,150(1+.04/12)^(360) x (.04/12) / [(1+.04/12)^(360) - 1]: $807.55 Total Paid: $807.55 x 360 = $290,718.00 Total Paid (including down payment): $290,718.00 + DP ($29,850.00) = $320,568.00 Total Interest Paid: $320,568.00 - $199,000.00 = $121,568.00 On Payment #153, the portion of my monthly payment going to principal exceeds the portion going to interest. On Payment #125 I can stop paying PMI. Payment #205-206, I have at least 50% equity in my home. If I sold my home after 7 years, I would STILL owe: $145,569.41 PMI: (0.75% x $169,150.00) = $1,268.63 Property Tax: (1.25% x $199,000.00) = $2,487.50 Home owner's insurance: (0.3% x $199,000.00) = $597.00 Total Monthly Housing Costs (mortgage, PMI, Property tax, Home Insurance): $807.55 +$2,487.50 + $597.00 +$1,268.63 + $100= $5,260.68 My total Monthly Housing Costs are .01% of my gross salary. 15 YEAR* Interest Rate: 3.625% = .03625 Monthly Mortgage Payment: pymt = $169,150(1+.03625/12)^(180) x (.03625/12) / [(1+.03625/12)^(180) - 1]: $1,219.63 Total Paid: $1,219.63 x 180 = $219,533.40 Total Paid (including down payment): $219,533.40 + DP ($29,850.00) = $249,383.40 Total Interest Paid: $249,383.40 - $199,000.00 = $50,383.40 The portion of my monthly payment going to principal exceeds the portion going to interest. On Payment #49, I can stop paying PMI. On Payment #99, I have at least 50% equity in my home. If I sold my home after 7 years, I would STILL owe: $101,504.51 PMI: (0.75% x $169,150.00) = $1,268.63 Property tax: (1.25% x $199,000.00) = $2,487.50 Home owner's insurance: (0.3% x $199,000.00) = $597.00 Total Monthly Housing Costs (mortgage, PMI, Property tax, Home Insurance): $1,219.63 + $1,268.63 + $597.00 + $2,487.50 + $100= $5,672.76 My total Monthly Housing Costs are .01% of my gross salary. The pros of each loan are that both are within range for my salary to cover. Another pro for the 30 year loan is that for me, it would be cheaper to pay the mortgage payment and manage the other expenses vs. the 15 year loan. A con for the 30 year loan would be that I would owe more money if I were to put it up for sale after 7 years, and I would have also paid more interest vs. the 15 year loan. A con for the 15 year loan would be that the total monthly cost would be more expensive when compared to the 30 year loan.
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