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If a simple interest car loan is paid off earlydo you deduct interest left on the loan from final payment?

Melissa Norris

in Student Loans

1 answer

1 answer

Jodi Brooks on April 19, 2019

the loan is 3 year loan with an annual interest rate of 6.3% and make monthly payments. Therefore, each amount of interest is based on a period of a month and therefore 1/12 of the annual of the rate of interest. Balance = 10,000 Monthly Interest Rate = 0.525 % 1 months interest = 10,000 * .00525 = $52.50 Your monthly payment is $305.58 Amount applied to balance = 305.58 - 52.50 = $253.08 New Balance = 10,000 - 253.08 = $9,746.92 the Next month the interest will be calculated on the new lower balance and your intest payment will be $51.17. so you would have to figure that out by the number of pmnts you've made by the WAY: This does not take into account the finance charges, billing charges, etc

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