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— Slide 4: How the BLOC Can Be Used —
Let's Look at Another Example

Let's say that you wanted to purchase a new car for $27,000 with the following terms (sample only, actual terms may differ):

Loan Amount: $27,000
Fixed Rate: 7.50%
Repayment Term: 60 months
Monthly Payment: $541.02


The total amount of interest and principal paid over the 60-month term at 7.50%:

Total Payments $32,461
Total Interest Paid $5,461
Total Principal Paid $27,000

Your loan repayment plan would look like this:

 


Month

Starting
Balance

Monthly
Payment

Interest

Prin
1 $27,000.00 $541.02 $168.75 $372.27
2 26,627.73 541.02 166.42 374.60
3 26,253.12 541.02 164.08 376.94
4 25,876.18 541.02 161.73 379.30
57 2,130.70 541.02 13.32 527.71
58 1,602.99 541.02 10.02 531.01
59 1,071.99 541.02 6.70 534.32
60 537.66 541.02 3.36 537.66
Total: $32,461 $5,461 $27,000

In this example:

An amortization schedule is calculated that shows that the borrower must pay $541.02 each month for 60 months in order to meet the interest obligation and to pay down the borrowed amount to $0 over 5 years.

The interest charges for the first month is calculated as such:

$27,000 X 7.50% (divided by) 12 months = $168.75

In the first payment, the borrower pays the lender $168.75 in interest. The remaining amount of $372.27 will repay the loan and reduce the borrowed amount to $26,627.73.

The interest charges for the second month is calculated as such:

$26,627.73 X 7.50% (divided by) 12 months = $166.42

In the second payment, the borrower pays the lender $166.42 in interest. The remaining amount of $374.60 will repay the loan balance and reduce the borrowed amount to $26,253.12.

This will continue all the way through the 60th payment, where the borrower pays the lender $3.36 in interest. The remaining amount of $537.66 will repay the loan balance and reduce the borrowed amount to $0. The loan obligation has been paid off.

 

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Home Equity Application

BANK EQUITY for Auto Buying