The formula for computing the annual loan payments is provided and explained below:
PMT=P(r/n)/1-(1+r/n)^(-nt)
P=loan amount=$13,000
r=interest rate=7%
n=number of payments in a year=1
t= duration of loan= 6 years
PMT= 13,000*(7%/1)/(1-(1+7%/1)^(-1*6)
PMT=13000*0.07/(1-(1.07)^-6
PMT=$2727.35
A loan is whilst cash given to every other party in change for compensation of the mortgage's main quantity plus hobby. creditors will not forget a prospective borrower's earnings, credit score, and debt ranges earlier than identifying to provide them with a mortgage.
A secured mortgage makes use of an asset you very own as collateral; the lender can take the asset in case you do not pay off the mortgage. An unsecured mortgage calls for no collateral. They commonly have higher hobby prices than secured loans due to the fact they may be riskier for creditors.
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