Marisol finances a sports car for $27,700 by taking out an installment loan for 36 months. The payments were $998.61 per month and the total finance charge was $8,249.96. After 21 months, Marisol decided to pay off the loan. After calculating the finance charge rebate, find her loan payoff amount.

Marisol finances a sports car for $27,700 by taking out an installment loan for 36 months. The payments were $998.61 per month and the total finance charge was $8,249.96. After 21 months, Marisol decided to pay off the loan. After calculating the finance charge rebate, find her loan payoff amount.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter3: Income Sources

Section: Chapter Questions

Problem 79P

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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

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