Real Estate Math
A Pennsylvania buyer obtains a 30-year $240,000 mortgage. After 5 years of payments, the balance has been reduced to $230,000. How much principal was paid in 5 years?
A$10,000✓ Correct
B$12,000
C$48,000
D$5,000
Explanation
Principal paid = $240,000 − $230,000 = $10,000 over 5 years (60 payments). The slow early principal paydown illustrates amortization — most of the early payments go to interest.
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