CL - Monthly Payments Lesson

Monthly Payments

Introduction

It’s important to decide whether or not you can afford a loan payment before accepting a loan offer. There’s a different process for loans with monthly payments when compared to the process for single payment loans. The interest is compounded here, which makes the equation a bit tougher! Monthly payments still tend to be preferred because it’s easiest to budget and pay back the loan this way. Although, you’ll see that you end up spending a ton in interest! 

In Your Notebook: Please take down important notes, such as formulas, and attempt the practice examples on your own before viewing the solutions!

Using a Calculator for Monthly Payments

The following video will give an example of how a calculator can be used to help determine the monthly payment for a loan. Take notes and attempt to follow along using your own calculator.

Using a Spreadsheet for Monthly Payments

The following video will give an example of how a spreadsheet program, such as Microsoft Excel, can be used to calculate the monthly payment for a loan. Take notes and attempt to follow along using your own spreadsheet if possible.

IMAGES CREATED BY GAVS or OER