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Oct 1, 2014
 #1
avatar+23254 
+5

We'll have to calculate how much will be paid over the course of those 17 years.

To do that, we'll first have to calculate how much each monthly payment is.

According to the web site www.1728.com the formula to use is:

Monthly Payment = {rate + rate/[ (1 + rate)^months - 1] } x Principal

The Principal of the loan is 32750

The number of months is 17 years x 12 months per year = 204 months

The rate is 6.24%  =  .0624  yearly which, when divided by 12 becomes  0.0052.

Monthly Payment  =  {0.0052 + 0.0052 / [ (1 + 0.0052) ^ 204 - 1] } x  32750

Monthly Payment  =  $260.85

Pay this monthly payment for 12 months per year for 17 years:  $260.85 x 12 x 17  =  $53.213.40

But since the loan was only for $32,750.00, subtract to get  $20,463.40  total interest paid.

Oct 1, 2014

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