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# Advanced Math/work our repayment plan

Question
Hi, I want a car on finance. price is at \$29,320.00. my deposit is \$9,902.57. interest is 7% over 4 years.

how do i work out monthly repayments?

based on my calculations i get \$1359.22.
how much do i owe in year 1, year 2, year 3 and year 4?

i'm confused on this.
Thank you.

Here is the formula for monthly payments:

P(R/12)/(1-(1+R/12)^-m)

P is the principal amount of the loan

R is the interest rate, expressed as a decimal

m is the number of monthly payments

Since you paid 9,902.57 already , your principal P is 29,320 - \$9,902.57 = 19,417.43

Interest rate is 7% , so R is .07

Over 4 years , there are 48 months, so m = 48

R/12 = .07/12 = .00583

(1+R/12)^-m = (1.00583)^-48 = .75652

(1-(1+R/12)^-m) = (1-.75652) = .24348

P(R/12) = (19,417.43)(.00583) = 113.20361

so your monthly payment will be

113.20361 /.24348 = \$464.94

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#### Socrates

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