To find out how much money will be spent in interest alone for a 3.5% 30-year mortgage with a principal of [tex]$180,000.00 and a monthly payment of $[/tex]808, you can follow these steps:
1. Calculate the Total Amount Paid Over the Course of the Mortgage:
- The mortgage lasts for 30 years.
- There are 12 months in a year.
- Monthly payment is [tex]$808.
The total number of payments made over the entire period can be calculated by multiplying the number of years by the number of months in a year. This is \(30 \times 12 = 360\) months.
Therefore, the total paid over these 360 months is:
\[
\text{Total Amount Paid} = \text{Monthly Payment} \times \text{Number of Payments}
\]
\[
\text{Total Amount Paid} = 808 \times 360 = \$[/tex] 290,880
\]
2. Calculate the Total Interest Paid:
- The principal amount (the initial amount of the loan) is [tex]$180,000.00.
- To find the total interest paid, subtract the principal from the total amount paid over the course of the mortgage.
The formula for total interest paid is:
\[
\text{Total Interest} = \text{Total Amount Paid} - \text{Principal}
\]
\[
\text{Total Interest} = 290,880 - 180,000 = \$[/tex] 110,880
\]
So, the amount of money that will be spent on interest alone over the course of the 3.5% 30-year mortgage is $110,880.
