Iscuss the distributions of principal


The case is designed to determine and evaluate the payment amount of a car loan and a mortgage, based on your income. If you prefer, you may assume that your household income is $48,000 per year or $4,000 per month. Based on your income, you may spend 28 percent of your monthly income on housing and 10 percent on a car loan. You are to put a 3 percent down payment on the house and a 10 percent down payment on the car. These will make the loan to value of your oans to less than one: 97 percent on the house and 90 percent on the car.

  • Determine the car payment and mortgage payment with the following
  • conditions: your monthly household income, 10 percent for the car payment,and
  • 28 percent for the mortgage payment. Also, assume a 10 percent down payment on the car and a 3 percent down payment on the  house.
  • Create an amortization schedule, and graph the components over time:interest, principal, and balance.
  • Discuss the distributions of principal, interest, and the balance over the life of the loan.

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Finance Basics: Iscuss the distributions of principal
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