Would someone please detail equations on how a loan with a $2k monthly payment goes to $3k monthly if the rate goes from 4% to 6%? Using Bankrate.com’s mortgage calculator payments on a $420k 30yr loan goes from $2005.14 @ 4% to $2518.11 @ 6%. In order to hit $3k a month the rate would have to go to almost 8% ($2995 @ 7.7%). Looking at these three datapoints it seems that rate increase may be related to payment increase by a 2:1 ratio. Was this a generalized comment that exaggerated the rate increase effect or is there something I’m not catching?
