Question

The interest portion of a monthly loan payment is $427.93. If the interest rate is 6.875%, what is the current principal balance

Answer 1

The current principal balance is $74, 693.24

Hope it helps :)

Answer 2

The current principal balance is $74,693.24.

Given that,

• The interest portion of a monthly loan payment is $427.93.
• And, the interest rate is 6.875%.

Based on the above information, the calculation is as follows:

Annual interest = $427.93 × 12

= $5,135.16

Now  

Principal is

= $5,135.16 ÷ .06875

= $74,693.24

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