Bryan agrees to pay back a $50,000 loan over a 10-year period. If the interest rate is 8%, what will his monthly payments be?

Bryan agrees to pay back a $50,000 loan over a 10-year period. If the interest rate is 8%, what will his monthly payments be?

Detailed Explanation

The interest on a 50,000 loan is 50,000 × 8% = 4,000. The amount that must be paid back is 50,000 + 4,000 = 54,000. There are 120 months in 10 years. If this is to be paid over a 10-year period, each monthly payment will be 54,000/120 =450.