Monthly loan payment on a $15,500 loan for 6 years with a 4.95% interest rate

Given:
Loan Amount: $15,500
Loan Terms: 6 years = 72 months = n  (convert years to months)
Interest Rate: 4.95% =
4.95/100
= 0.0495 = r  (convert percent to a decimal)
Monthly Loan Payment Formula:
Monthly Loan Payment =  
Loan Amount  * 
r / 12
/ 1 – ( 1+
r/12
 ) -n

Substitute given values into Monthly Payment Formula:
Monthly Loan Payment =  
15,500  * 
0.0495 / 12
/ 1 – ( 1+
0.0495/12
 ) -72

Monthly Loan Payment =  $249.27  ( rounded to two decimal places)
Notes:
Total Cost =  Monthly Loan Payment * Number of Payments
Total Cost =  $249.27 * 72 =  $17,947.44
Interest Cost =  Total Cost – Loan Amount
Interest Cost =  $17,947.44 – $15,500 =  $2,447.44

The solution above and other related solutions were provided by the Monthly Loan Payment Application. 

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