By Admin on Dec 27, 2009 in Homework Help
fwerds asked:
I need help with the calculation for this…
I need help with the calculation for this…
What amortization payments would be required every six months, at 14% interest, to pay off a $35,000 loan within four years? Round your answer to the nearest cent.
So how would you do this? Thanks!
I tried that & it doesn’t come out right.. so confused 
If this is simple interest, then 14% times the amount borrowed, $35,000, divided by 8, which would be the number of payments based on 1 every 6 months for 4 years. That is the process, now I think you can do the math yourself. Don’t let the term “amortization” boggle your mind. Amortization only refers to the time period and the amount per payment needed to pay off the debt. By the way, “Amortization” has a root that refers to the death of something. “Amortization” is simply the process of “killing” a loan.
kerry k | Dec 30, 2009 | Reply
Principal borrowed: $35000.00
Annual Payments: 2 Total Payments: 8
Annual interest rate: 14.00% Periodic interest rate: 7.0000%
Regular Payment amount: $5861.37
Total Repaid: $46890.96
Total Interest Paid: $11890.96
To see the actual amortization schedule, go to the site given below.
Greg H | Jan 2, 2010 | Reply