Humber/Ontario Real Estate Course 4 Exam Practice

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If the bi-weekly mortgage payment factor is 3.154884, what is the bi-weekly payment for a $412,000 mortgage with a 20-year amortization and a 5.5% interest rate?

$1,159.27
$1,299.81
$1,545.59
$2,599.62

The correct answer is: $1,299.81

To determine the bi-weekly payment for a $412,000 mortgage using the provided mortgage payment factor, you multiply the mortgage amount by the bi-weekly payment factor. The bi-weekly mortgage payment factor of 3.154884 indicates how much a borrower must pay for every $1,000 borrowed. The calculation is done as follows: 1. First, divide the mortgage amount by 1,000 to get the number of thousands: \[ 412,000 / 1,000 = 412 \] 2. Then, multiply this number by the bi-weekly payment factor: \[ 412 \times 3.154884 = 1,299.81 \] This calculation yields a bi-weekly payment of $1,299.81, affirming that this is indeed the correct amount that needs to be paid bi-weekly on a $412,000 mortgage with the specified terms.