1. Which Mortgage is Better?
By: Michael Yau

2. Background
 In this unit we learn about mortgage. In fact which
kind of mortgage Is better or a better word to quote it
would be which fits the best for “u”. Mortgage doesn’t
only differ in amount of money they offer but also the
amount of time it is attach to the loan. In conclusion
this project is all about comparing and deciding
which loan best fits for you or the occasion you’re in.

3. What Mortgage was offers?
 Cost of the house: $175,000
 Down Payment: 10%
 Period: 15years, 30years
 Amount of Loan: $157,500
 Interest Rate: 5%

4. Venn Diagram

5. Comparison of each mortgage
15 30
Interest Paid over life $66,695.10 $146,883.32
Total amount paid $224,195.10 $303,883.32
Monthly Payment $1,245.50 $845.49
Extra $100 $7,733.43 $35,048.35
Extra $500 $26,237.55 $87,921.09

6. Interest Paid Over Life
Interest Paid
$160,000.00
$140,000.00
$120,000.00
$100,000.00
$80,000.00 Interest Paid
$60,000.00
$40,000.00
$20,000.00
$0.00
15 Years 30 Years

7. Total Amount Paid
Total Amount Paid
$350,000.00
$300,000.00
$250,000.00
$200,000.00
Total Amount Paid
$150,000.00
$100,000.00
$50,000.00
$0.00
15 Years 30 Years

8. Monthly Payment
Monthly Payment
$1,400.00
$1,200.00
$1,000.00
$800.00
Monthly Payment
$600.00
$400.00
$200.00
$0.00
15 Years 30 Years

9. Extra $100
Interest Paid If Extra $100 Is paid
$40,000.00
$35,000.00
$30,000.00
$25,000.00
Interest Paid If Extra
$20,000.00 $100 Is paid
$15,000.00
$10,000.00
$5,000.00
$0.00
15 Years 30 Years

10. Interest paid if $500 is add
$90,000.00
$80,000.00
$70,000.00
$60,000.00
$50,000.00 Interest paid if $500 is
$40,000.00 add
$30,000.00
$20,000.00
$10,000.00
$0.00
15 Years 30 Years

11. Job
 III (senior) chemist
 Annual Salary: $70,363
 Monthly Salary: $5863.58
http://depositphotos.com/3873987/stock-photo-
Chemist-at-work.html

12. Calculation
 Monthly Payment:
 15 years- $1,245.50
 30 years- $845.49
 Monthly Salary- $5,863.58
 Calculation:
 15 years- $1,245,50
$5,863.58 = 21%
 30 years- $845.49
$5,863.58 = 14%
http://www.iconarchive.com/show/must-have-
icons-by-visualpharm/Check-icon.html

13. Calculation
 15 years
 Total Fixed Payment: $1245.5+ $1329.67
$5863.58 = 44%
 30 years http://www.iconfinder.com/icondetails/27842/
128/close_delete_exit_no_reject_icon
 Total Fixed Payment: $845.49+$1329.67
$5863.58 = 37%
http://www.iconarchive.com/show/must-have-
icons-by-visualpharm/Check-icon.html

14. Which one is better?
 It’s better to take out a 30 years mortgage because it
only cost you 14% of your total income which means
you would have the rest to spend and save on other
things. Also the total amount loan you can ask for is
36% of your total monthly income. Therefore, it gives
you an extra 22% are for loans. Also 30 years
mortgage qualify the requirement for fixed payment.
Plus it gives you a lot more to spend and save.

15. Sources
 http://www1.salary.com/Chemist-III-Salary.html
 http://www.lendingtree.com/mortgage-
loans/advice/qualifying-for-a-loan/minimum-
mortgage-qualifications/
 http://www.fha.com/fha_requirements_debt.cfm