In this project we learned about Government and Bank loans. The difference between Government subsidized and unsubsidized loans is the interest on subsidized loans are paid for by the federal government as long as you are attending school.The government does not pay interest on unsubsidized loans. Bank loans are not funded by the federal government but are funded by banks and other lenders and do not have as flexible payments as federal loans. Federal student loans offer lower interest rates and have a flexible repayment option. If you paid $5,000 a year in loans, a total of $20,000 after 4 years, you would owe a total of $31,357. With an interest rate of 4.6% you would find your total by putting it into the equation A=P(1+r)^n. Your equation would then read A=20,000(1+.046)^10 to get the total amount owed of $31,357. When dividing it by 120, because there is 120 months in 10 years, you get $261 which is what you would pay monthly for 10 years.
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AuthorRaquel Smith Archives
April 2015
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