What is your monthly repayment?

Question

Suppose that your unsubsidized Stafford loans plus accumulated interest total $ 35000 at the time you start repayment, the interest rate is 6% APR, and you elect the standard repayment plan of a fixed amount each month for 10 years. What is your monthly repayment?

Repayment amount = 

How much will you pay in interest?

Interest paid =

Answer 1

I would use spreadsheet goal seeking for a more precise answer, give or take rounding choices, but for an average balance of 17500 and 6% being .5% a month, the rough average monthly interest is 87.50, plus 35000 / 120 of principal. This is a bit low as the initial interest is higher, and the final interest is almost nil. The amortization curve of a long low interest loan is pretty flat. Banks must round down to avoid overcharging advertised interest, but often charge daily interest, so exact payment dates avoiding bank holidays and weekends also vary the calculation.