Question

You have an outstanding student loan with required payments of$500 per month for the next four years. The interest rate on the loan is 8% APR? (compounded monthly). Now that you realize your best investment is to prepay your student? loan, you decide to prepay as much as you can each month. Looking at your? budget, you can afford to pay an extra $250 a month in addition to your required monthly payments of $500?, or $750 in total each month. How long will it take you to pay off the? loan?

Answer 1

Without the original loan amount, it is not possible to calculate the exact time it will take to pay off the loan by paying an extra $250 per month. More information is required to perform such a calculation.

Step-by-step explanation:

To determine how long it will take to pay off a student loan by paying an extra amount each month, you can use an amortization formula or a financial calculator. However, because the original loan amount is not provided, we cannot calculate the exact time it will take to pay off the loan. If you were to add an extra $250 to your monthly payments, the loan would certainly be paid off faster than the original term, but without more information, we cannot provide a specific timeframe.