Real Estate Math
A buyer takes out a 30-year fixed-rate mortgage for $280,000 at 7% annual interest. What is the approximate monthly interest charge for the first month?
A$1,633.33✓ Correct
B$1,750.00
C$1,680.00
D$1,566.67
Explanation
Monthly interest = Principal × (Annual rate ÷ 12) = $280,000 × (0.07 ÷ 12) = $280,000 × 0.005833 = $1,633.33 for the first month. The actual monthly payment would be higher to include principal repayment.
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