ou are about to buy a home. You know about tax consequences, and you know how to use Excel. The specifications on
your nice, new home loan are:
Purchase Price: 350000
Down Payment Percent: 20%
Payments / Year: 12
PMT monthly payment: 1584.92
For the same home loan in Question 3,
bought the home on the last day of August, first payment is on the last day of September.
So in the first year, will make 4 payments (September, October, November, December), Months (or rather Payments) 1-4.
want to know the tax impact of this purchase because home mortgage interest is deductible on federal and state income taxes,
want to know what your total Year 4 interest payments will be. (The sum of your interest of your monthly payments for a given year.)
Assume that Year 1's payments were the first 4.
What are your cumulative interest payments in Year 4?
(TWO decimal places, NO commas, NO dollar signs ($))
Hints: You have to negate the function, not the PV; This is an End of Year computation.