Lauren knows she can afford to make monthly payments of $425 for 48 months. How much will the bank lend her today on a 3% APR car loan in exchange for her promised monthly payments? Your Answer: You just took out a $200,000 mortgage. You must make equal monthly payments over 30 years, and your interest rate is 6% APR. What is your monthly payment? How much of the first month's payment is paying interest and how much is paying down the principal balance remaining on the loan? Your monthly payment is $1,245.08. $1,000 of your first month's payment goes toward interest, and $245.08 goes toward paying down the principal balance remaining. Your monthly payment is $1,199.10. $1,000 of your first month's payment goes toward interest, and $199.10 goes toward paying down the principal balance remaining. Your monthly payment is $1,199.10. $500 of your first month's payment goes toward interest, and $699.10 goes toward paying down the principal balance remaining. Your monthly payment is $1,245.08. $500 of your first month's payment goes toward interest, and $745.08 goes toward paying down the principal balance remaining Jeff just financed a used car through his credit union. His loan requires payments of $275 a month for five years. Assuming that all payments are paid on time, his last payment will pay off the loan in full. What type of loan does Bill have? 1) Lump sum 2) Amortized 3) Interest-only 4) Pure discount 5) Complex