Loan Balance

  Previous topic Next topic JavaScript is required for the print function  



The loan balance equals the present value of the monthly payment for the remaining term of the loan.  Use columns 5 and 6 of the compound interest tables to solve this problem.


Mortgage Problem #2:


Jane has a $100,000 loan at 8% for 30 years.  She has paid on it for 10 years.  What is the current balance?




1.Payment = Mortgage Constant (column 6) x Original Loan Amount (See Problem #1)
2.Payment = 0.00733765 x $100,000 = $733.76
3.Balance = Present Value of the monthly payment (an annuity) for the remaining term of the loan
4.Balance = 119.554292 x $733.76 = $87,724

Page url: