2. THE TOTAL AMOUNT PAID FOR THE PROPERTY
Total amount paid
$350,000.00
$300,000.00
$250,000.00
$200,000.00
Total amount paid
$150,000.00
$100,000.00
$50,000.00
$0.00
15 years 30 years
3. THE TOTAL AMOUNT OF INTEREST PAID BY THE
TIME YOU’VE PAID OFF YOUR LOAN
Total interest paid
$160,000.00
$140,000.00
$120,000.00
$100,000.00
Total interest paid
$80,000.00
$60,000.00
$40,000.00
$20,000.00
$0.00
15 years 30 years
4. HOW MUCH YOUR MONTHLY PAYMENTS ADD
UP TO
Monthly payment
$1,400.00
$1,200.00
$1,000.00
$800.00
Monthly payment
$600.00
$400.00
$200.00
$0.00
15 years 30 years
5. HOW MUCH MONEY YOU CAN SAVE BY PAYING
AN EXTRA 100 PER MONTH
Save $100
$40,000.00
$35,000.00
$30,000.00
$25,000.00
Save $100
$20,000.00
$15,000.00
$10,000.00
$5,000.00
$0.00
15 years 30 years
6. HOW MUCH MONEY YOU CAN SAVE BY PAYING
AN EXTRA 500 PER MONTH
Save $500
$450,000.00
$400,000.00
$350,000.00
$300,000.00
$250,000.00
$500
$200,000.00
$150,000.00
$100,000.00
$50,000.00
$0.00
15 years 30 years
7. WILL I BE ABLE TO AFFORD THIS??
Job: Lawyer
Salary: $131000
30 years
15years
Mortgage payment expense
(1245.5/10917) *100 = 11.4%
Total fixed payment
($1245.5 + 1329.67)/$10917= 24%
30years
Mortgage payment expense
845.49/10917*100 = 7.74%
Total Fixed payment
($845.49 + 1329.67)/10917 = 20%
8. ANALYSIS
• Can you afford the monthly payment for a 15 year mortgage? A 30
year mortgage?
I am able to afford both loans as my Mortgage payment expense is
11.4% and my total fixed payment 24%
• If you do not qualify for the loans, determine what you could do to
change this.
- Make more money, get a better job
- Increase length of loan
• If you have the choice, which one is better?
Well with my ideal career choice I would be earn
• Is it better to take out a 15 or 30 year mortgage? Explain why.
Refer to you pro/con list from the first part of the activity. It
depends on the person, if they can afford to pay more
monthly, then it would be wise to get a 15 year loan. But if you
cant afford to pay that much per month, then a 30 year loan
would be better. However with a 30 year loan, you end up paying
more with interest.