The interest-bearing loan is repaid in equal installments, paid monthly. First installment after 10 months, last...

The interest-bearing loan is repaid in equal installments, paid monthly. First installment after 10 months, last after 8 years. During the deferral period, interest is paid monthly (9 times).
The annual interest rate of EUR 97000 credit, capitalized monthly, is 5.10%.
(a) Calculate the monthly contribution.
(b) How much interest is paid in installments after 6 years and 1 month?
(c) How much credit is repaid in year 7 (starting with the contribution after 6 years and 1 month, ending with the contribution after 7th year)?

Solutions

Expert Solution

We can solve this problem in excel : Total tenure of the loan becomes = 8-10/12 = 7.16667 yrs

For first 9 months, only the interest will be paid: interest = 372 EUR

Monthly contribution = 1349 EUR

For 6 yrs and 1 month (73 months) total interest paid = 17976 EUR

EMI Repaid in year 7 = 16187 EUR

Princ. Amount paid in year 7 = 15682 EUR

jeff jeffy answered 1 year ago

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