Answer: $98.36
Explanation:
Based on the information that has already been given in the question, the following can be analysed:
For Loan 1:
Interest Rate = 7%
Nper = 30
Present value = $100000
With the above information, we can use the Excel calculator to solve further. To get the monthly payment for the first loan will be:
= pmt(rate, nper, pv,fv)
= pmt(7%/12,30×12,-100000,0)
= pmt(0.07/12,360,-100000,0)
= $665.30
For Loan 2:
Interest Rate = 7%
Nper = 30
Present value = $100000
Future value = $120000
With the above information, we can use the Excel calculator to solve further. To get the monthly payment for the first loan will be:
= pmt(rate, nper, pv,fv)
= pmt(7%/12,30×12,-100000,120000)
= pmt(0.07/12,360,-100000,120000)
= $566.94
The difference in the monthly payments will be:
= $665.3 - $566.94
= $98.36
