When you purchased your house, you took out a 30-year mortgage with an interest rate of 4.8% per year. The monthly payment on the mortgage $1,500. What is the payoff amount if you have lived in the house for 19 years ? (Round to the nearest dollar.) Answer:

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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.