Julio just bought a $267,900 house. He had a 20 year mortgage with a fixed rate of 5.875%. Julio’s monthly payments are $1,558.09. What percent of the purchase price was Julio’s down payment?

Use the mortgage payment formula to find the amount Julio borrowed: $1,558.09 × [1 − (1 + 0.05875/12)^(-240)] ÷ (0.05875/12) ≈ $219,700. His down payment was about $267,900 − $219,700 = $48,200. Dividing $48,200 by the $267,900 purchase price gives about 18%, so the correct choice is 18%.

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