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GSJ1

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Just wondering if anyone here can help me with a real life math problem I have on my hands right now!

I am going to borrow \$48,000 from a bank as an unsecured personal loan for a 3 year period.

I have to make minimum monthly payments of 1% of the outstanding loan balance at the end of every month.

And the interest rate is 4.9% per annum calculated on a monthly basis (ie. 4.9%/12 each month) on the outstanding loan balance at the end of every month.

So at the end of the first month I will have to pay 1% X \$48,000 or \$480 as a minimum payment that month, and 4.9%/12 X \$48,000 = \$196 as interest.

The loan balance then becomes \$48,000 - \$480 = \$47,520 at the end of the second month etc...

At the end of the 3 year period, what is the total amount of minimum monthly payments I will have made, assuming I pay down 1% of the outstanding loan balance each month.

At the end of the 3 year period, what is the total amount of interest payments I will have made, again assuming I pay down 1% of the outstanding loan balance each month.

Thanks so much.

If I have a number for this, then I can keep this money aside, and spend the rest of it, until I have to repay that amount in 3 years.

Hope that makes sense.