Gisella borrows $120, 000 from Capital Mortgage Co. at 9% per annum interest, monthly payments for 30 years. At the end of 6 years, she sells the house and will pay off the loan at the closing of sale (assume that the sale takes place at the end of the sixth year). What will her loan payoff be? Using excel functions only and an amortization schedule.

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Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.