What is present value and how can I calculate this problem?

I need to find the present value of a ten year loan after the third year of payments. The only other info I have is that the interest rate is 10.25% and the monthly payments are $450. Without knowing the actual amount of the loan is it possible to calculate the present value?What is present value and how can I calculate this problem?
Yes, of course. The present value is determined by the rate and monthly payments. In practice, it usually goes the other way around: we know the present value (loan amount) and interest rate which determine monthly level payments.





Present value at the time loan is issued can be found by the annuity formula:


PV = (monthly pmt)*a(n,i) (look up annuity-immediate)


using n=120, i=10.25/1200,


Loan amt = 33,698.02





Your question is the present value after the third year, which will be the present value of the remaining payments at the end of the third year (there are 84 of them left):





450*a(84,i) = 26,896.75What is present value and how can I calculate this problem?
Are you allowed to use a TI -83/4?





In the Apps, there is a Finance package use the TVM solver





n =120 (number of compoundings)


p/y = 12


c/y=12


I% = 10.25





place the cursor on the PV press alpha - enter to solve





You have now found the Principal value.