A mortgage loan of $50,000 requires monthly payments of principal and interest of $516.10 to fully amortize the loan for a term of 20 years. If the loan is paid over the 20-year term, how much interest does the borrower pay?
Calculation:
20 years x 12 months payment per year = 240 payments
240 x $516.1 = 123,864 total amount paid
Total Amount Paid - Principal Borrowed = interest
$123,864 - $50,000 = $73,864 interest paid
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