1. Loans- Chapter 8
Do Now- Jane Dimas obtained a single-payment loan of $420 to pay a repair bill that she did not have the cash for. She agreed to pay back the loan in 90 days at an interest rate of 12.75% exact interest. What is the maturity value of her loan?
Exact interest is = 365 days
I = P x R x T
$420 x x 90/365
=$13.20 interest
$420 principal borrowed + $13.20 interest owed
=$ maturity value (amount she has to pay back!)

2. Assignment: Workbook P.53 #1-4

3. Loans- Chapter 8 I = P x R X T $72,000 x .12 x 91/360= $2,184 interest
Do Now- Anita Sloane’s bank granted her a single-payment loan of $72,000 for 91 days at 12% ordinary interest. What is the maturity value of the loan?
Ordinary interest = 360 days
I = P x R X T
$72,000 x .12 x 91/360=
$2,184 interest
$72,000 principal + $2,184 interest=
$74,184 maturity value (amount that must be paid back in 91 days)

4. Assignment: Workbook P.53 #5-7

5. Loans – Chapter 8
Do Now- What is an installment loan? Can you give any examples?
An installment loan is a loan that is paid back in equal installments over a set period of time. People will usually give a down payment up front in order to lower their monthly payments. Home loans, car loans and college loans are popular types of installment loans.

6. Notes: Installment and Simple Interest Loans
Down Payment- The amount of $$$ you put down at the beginning of the loan to lower your monthly payments.
Amount Financed- Price of item you are buying – down payment.
Monthly Payment- The amount of the bill you will receive every month. It is fixed, meaning it will not change.
Finance Charge- The total amount you repay on the loan – the amount financed.

7. Do Now
Takesha Quintero is buying a new refrigerator for $1399. She makes a down payment of $199 and financed the rest. How much did she finance? Amount financed =Cash price – Down payment $ $199 = $1200 financed

8. Do Now
Rebecca Clay purchased a washer and dryer for $1140. She used the store’s installment credit plan to pay for the items. She made a 20% down payment and financed the rest. What amount did she finance? Cash price – down payment $1140 – (1140 x .20) $ $228 = $912 down payment

9. Do Now
Julio Fernandez purchases a stove with an installment loan that has an APR of 12%. The stove sells for $ The store requires a 10% down payment and 12 monthly payments. What is the finance charge? Step 1: Find the amount financed $ – (.10 x $ ) $ $140 = $

10. Step 2: Find the monthly payment Refer to the chart on page 54 for this! (Amount of loan / $100) x monthly payment for a $100 loan ($ /$100) x $8.88 from chart= $ monthly payment Step 3: Find the total amount repaid 12 month of payments x $ monthly payment= $ Step 4: Find the finance charge $ x $ = $82.69 finance charge

11. Assignment:
Workbook Page 54, #1-3

12. Do Now Turn to workbook p.54, #3 (Do on separate sheet of paper)
b)Look on the chart 12 months, 10% APR
The number you find is 8.79
8.79 x 120 = $ monthly payment
c) 12 monthly payments x $ =
$12, total amount paid back
d) Finance Charge = $12, $12,000
= $ finance charge (the cost of borrowing the $$)

13. Assignment: Workbook p.54, # 4 & 5

14. Loans- Ch. 8
Do Now- Sam Garcia obtained a 12-month loan from her credit union for $1500 at a rate of 12%. Her monthly payment is $ For the first payment: a) What is the interest? $1500 x .12 x 1/12 = $15 interest b) How much is the payment to principal? $ $15 = $ c) What is the new balance? $ $ = $ new balance

15. Do Now
James Connor took a 24 month loan of $7,000 from his bank at a rate of 8.75%. His first monthly payment is $ For the first payment: a) What is the interest? $7000 x x 1/12 = $51.04 interest b) What is the payment to principal? =$ $51.04 = $ payment to principal c) What is the new balance? =$7,000 - $ = $ new balance

16. Assignment: Workbook Page 55, #1-3

17. Do Now Turn to your notebook, page 55, #4
Patricia Nichols took out a $4,000 simple interest loan at 12 % for 12 months. After 5 payments, the balance was $ She pays the loan off when the next payment is due.
What is the current month’s interest?
$ x .12 x 1/12=
$23.92 interest
b) What is the final payment?
$ $23.92=
$ final payment

18. Assignment: Workbook, Page 55 # 4 & 5

19. Do Now
Natalie Rubino is planning to borrow $2,800 for a new furnace. Bell Finance will loan her the money for 24 months at a finance charge of $428. What is the APR on this loan? Please turn to page 56 in WB $100 x (finance charge / amount financed) $100 x ($428 / $2800)= $100 x = $15.29 Chart- Go down to 24 months, trace across to # closest to $15.29 and locate the APR on top! APR is 14%

20. Assignment Workbook, Page 56, #1-3

21. Please turn to page 56, #3 in your notebooks
Do Now
Please turn to page 56, #3 in your notebooks
$ $574.54
= $2,000 amount financed
$121 monthly payment x 18 months
=$2,178 total payments - $2000 financed
=$178 finance charge
$100 x ($178 / $2000)
=8.9  look on chart  18 months, $8.90
= 11% APR

22. Assignment Workbook, Page 56, #4 & 5