A borrower purchases a $400,000 home with 10% down. The loan amount is $360,000 at 6% for 30 years. What is the approximate monthly principal and interest payment?

Correct answer: $2,158

Using the standard amortization formula with P=$360,000, r=0.06/12=0.005, n=360: Payment = $360,000 × [0.005(1.005)^360]/[(1.005)^360-1] = approximately $2,158 per month. This is P&I only, not including taxes and insurance.