OK, I know now what the problem is. Look at your question where you say "7% compounded monthly".
Your 7% is NOT compounded monthly!!!. It is compounded ANNUALLY!!. Which means we have to convert the interest rate of 7% compounded annually to compounded monthly.
And this is how you do that: 1.07^(1/12) =1.00565414538 - 1 x 1,200 =6.784974465%. This is the interest compounded monthly!!. Which is equivalent to 7% compounded annually. This will give you a monthly payment of $1,044.74 when you enter it in the above formula that I used.