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THE SCENARIO
Last time, we discussed how long it would take to pay off a $100,000 mortgage at 6% if we could only afford a $475 monthly payment.
Let's say, however, that we managed to find a 40-year fully-amortizing loan for $100,000 that has a $475 per month payment.
The question: What's the interest rate on that loan?
THE SOLUTION
This one is pretty straightforward.
First things first, make sure the calculator is using 12 Payments per Year.
N: 480 (The loan is for 40 years, which is 40 x 12 = 480 months)
I/YR: (This is what I'm trying to find)
PV: 100,000 ...
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