Monthly loan payment on a $22,900 loan for 5 years with a 7% interest rate

Given:
Loan Amount: $22,900
Loan Terms: 5 years = 60 months = n  (convert years to months)
Interest Rate: 7% =
7/100
= 0.07 = 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 =  
22,900  * 
0.07 / 12
/ 1 – ( 1+
0.07/12
 ) -60

Monthly Loan Payment =  $453.45  ( rounded to two decimal places)
Notes:
Total Cost =  Monthly Loan Payment * Number of Payments
Total Cost =  $453.45 * 60 =  $27,207
Interest Cost =  Total Cost – Loan Amount
Interest Cost =  $27,207 – $22,900 =  $4,307

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

Monthly Loan Payment

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