Real Estate Math
A Pennsylvania mortgage has an outstanding balance of $175,000 at 6%. What is the monthly interest portion for that month?
A$750
B$875✓ Correct
C$1,050
D$1,260
Explanation
Monthly interest = Balance × (Annual Rate ÷ 12) = $175,000 × (6% ÷ 12) = $175,000 × 0.005 = $875. This monthly interest calculation is used in amortization schedules to determine how much of each payment goes to interest versus principal.
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