Actuarial Science 2053 Chapter Notes - Chapter 5: Refinancing, Sinking Fund, 18 Months
20 Jan 2016
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Refinancing a loan the sum of digits. Define: i = total interest paid on loan = nr a, sum of digits 1 to n, sn = A loan of is to be repaid with 6 equal monthly payments at j12 = 12%. Set up a repayment schedule using the sum of digits method. As of january 1, 1983, this method became illegal for consumer loans issued by. Canadian chartered banks: but it can still be used (and sometimes is used) by car dealers and furniture companies. Interest rebate = s kn s n ( i ) Bk less: payments to date = k r. A woman borrows from a loan company to be repaid by monthly payments over 3 years at j12 = 9%. She decides to pay off the balance in full at the end of 16 months (without penalty). Compare your answer to the outstanding balance using the amortization method.
