Dave borrowed $210000 at a rate of 11.10%, simple interest, with monthly interest payments.?
Answers:
Is this a trick question?
Usually a problem talks about assuming 30-day months and 360-day years. And in that case, the interest would be just one-twelfth of 11.10% of $210,000 = $1,942.50.
Taking your state problem literally, the simple interest for a 30-day month in a 365-day year should be:
(30/365) (11.10%) ($210,000) = $1,915.89.
The way they figure it for mortgages is 210,000 x .111= 23310 / 365 x 30 = 1915.89
well that depends on what type of loan that is. Is it an interest only loan to the end of the loan were the principle is due upon complete date. if that was the case the payment would be 1942.50 per month. if you added in a payment you would need to know how long the length of the lone was... was the loan for a year... 15 years . 30 years... If so then you add your interest rate to the monthly payment of your loan
That's a very high interest rate but I recon you switch to a longer perpayment period. This will probally save your money and interest. For example, If I borrow from a bank loan about RM 200,000 and my interest would be around 8% then I would save alot later or earlier prepayment but it just a thought and opinion.
Dave is an idiot and soon file for bankruptcy.
The answer is that the Monthly Interest Payment would be different every month. Simple Interest Loans DO NOT work like normal loans (IE: Pre-Computed Notes - which is what 99.99999% of all mortgages are today). The Average 30 year note on simple interest pays off around 20 years.
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