(Answered) Consider a 30-year fixed-rate mortgage to buy a new home

Finance

Consider a 30-year, fixed-rate mortgage to buy a new home for $225,000. Your bank will lend you the money at an APR of 5.5 percent with monthly compounding. You can only afford monthly payments of $1,000 for principal and interest, so you offer to pay off any remaining loan balance at the end of the loan term in the form of a single balloon payment. What will be the amount of the balloon payment?

a. $232,191

b. $213,316

c. $254,480

d. $253,550

e. $226,315

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