What is the payoff for a loan with monthly payments of $359.69, after 26 payments have been made, contract was for 3yrs. at an annual interest rate of 9.2%?
need to figure out payoff with 10 payments left, not working out for me
To calculate the payoff for a loan with monthly payments, you'll need to know the loan amount, the interest rate, and the number of remaining payments. In your case, you have made 26 payments out of a 36-month (3-year) loan at an annual interest rate of 9.2%.
Step 1: Determine the loan amount
To find the loan amount, you will need to use the present value formula for an ordinary annuity. The formula is:
Loan Amount = Monthly Payment * [(1 - (1 + Monthly Interest Rate)^(-Number of Payments))] / Monthly Interest Rate
First, convert the annual interest rate to a monthly interest rate by dividing it by 12, and convert it to a decimal by dividing by 100. In this case, the monthly interest rate is 9.2% / 12 = 0.092 / 100 = 0.00767.
Using the given monthly payment of $359.69 and the number of payments remaining (10), you can calculate the loan amount:
Loan Amount = $359.69 * [(1 - (1 + 0.00767)^(-10))] / 0.00767
Step 2: Calculate the payoff
To calculate the payoff, subtract the remaining principal balance from the loan amount. The remaining principal balance can be found by using the remaining interest rate and the remaining number of payments.
Remaining Principal Balance = Monthly Payment * [(1 - (1 + Monthly Interest Rate)^(-Remaining Number of Payments))] / Monthly Interest Rate
Remaining Number of Payments = Total Number of Payments - Number of Payments Made
Using the remaining interest rate (9.2%), the remaining number of payments (10), and the previously calculated loan amount, you can find the remaining principal balance:
Remaining Principal Balance = $359.69 * [(1 - (1 + 0.00767)^(-10))] / 0.00767
Finally, the payoff amount is given by:
Payoff = Loan Amount - Remaining Principal Balance
By plugging in the values and following these steps, you should be able to find the payoff for your loan.