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The after college APR interest rates are 6.9% for 10 years and 7.4 % for 15...

The after college APR interest rates are 6.9% for 10 years and 7.4 % for 15 years. $5000 you believe your loan will be and then evaluate for both APR's. choose the APR option that best suits your budget. Once you choose the best payment option, determine how much interest you will have paid by the time you pay off the loan.

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Answer #1

Looking in to the budget if your monthly income is less then the monthly payment for both the option are as follows

Mortgage amount 5000
Mortgage term(in months) 10
Interest rate per year 7%
Monthly payments $708.60 PMT(D5,10,-5000,0)
Interest per month $59.05 PMT(D5,10,-D3,0)/12
Principal per month $649.55
Mortgage amount 5000
Mortgage term(in months) 15
Interest rate per year 7%
Monthly payments $562.92
Interest per month $46.91
Principal per month $516.01

Best option will be second one as monthly payments are less

Interest paid for 15 yrs will be 1935.62$

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