Question 1065886
loan amount was 21,000.
interest on loan is 4.5% per year compounded monthly.
6 month grace period is now over.
interest is now being charged and he wants to pay the loan off in 4 years.


it is not clear whether he has to pay the interest on the loan during the 6 month grace period.


if he doesn't have to pay interest for the 6 month grace period, then:


present value of loan = 21,000.
interest rate per month is 4.5%/12 = .375% per month.
number of months = 4 * 12 = 48.
future value of loan = 0.
monthly payments are made at the end of each month.
you need to solve for the monthly payments.


using the time value of money calculator at <a href = "http://arachnoid.com/finance/" target = "_blank">http://arachnoid.com/finance/</a>, you will get monthly payments of 478.87 per month.


if he does have to pay interest for the 6 month grace period, then the present value of the loan will be 21,000 * (1 + .375/100) ^ 6.


this will make the present value of the loan equal to 21476.9519


keep everything else the same and use the same calculator to get a monthly payment of 489.75.


first picture is the use of the calculator to find the payments required for the 21,000.


second picture is the use of the calculator to find the payments reuqired for the 21,476.9519.


<img src="http://theo.x10hosting.com/2017/013001.jpg" alt="$$$" </>


<img src="http://theo.x10hosting.com/2017/013001.jpg" alt="$$$" </>