Answer: $1,071.54
Explanation:
To find the interest refund, first we need to calculate the total interest charged on the loan. We can do this by multiplying the monthly interest by the number of months in the loan:
Monthly interest = Total interest / Number of months
Monthly interest = $2,802 / 35
Monthly interest = $80.06
Total interest charged on the loan = Monthly interest x Number of months
Total interest charged on the loan = $80.06 x 35
Total interest charged on the loan = $2,802.10
Now we need to calculate the interest that would have been charged for the remaining 13 months of the loan:
Interest for remaining 13 months = Monthly interest x Remaining months
Interest for remaining 13 months = $80.06 x 13
Interest for remaining 13 months = $1,040.78
Finally, we can find the interest refund by subtracting the interest for the remaining 13 months from the total interest charged on the loan:
Interest refund = Total interest charged - Interest for remaining months
Interest refund = $2,802.10 - $1,040.78
Interest refund = $1,074.32
Therefore, the interest refund on the loan is $1,074.30.