Financial planning cases 7-5 Clauses in a Car Purchase Contract Lauren Rowland i

Question

Financial planning cases 7-5 Clauses in a Car Purchase Contract Lauren Rowland is a dentist in Hebron, Kentucky, who recently entered into a contract to buy a new automobile. After signing to finance $41,000, she hurriedly left the office of the sales finance company with her copy of the contract. Later that evening, Lauren read the defidency payments, a recourse, and a rule of 78s clause. When she signed the contract, Lauren was told these standard clauses should not concern her several dauses - an acceleration, a contract and noticed a. Should Lauren be concerned about these clauses? why or why not? The input in the box below will not be graded, but may be reviewed and considered by your instructor ng the rule of 78s dause, what will happen if Lauren pays off the loan before the regular due date? de The input in the box below will not be graded, but may be reviewed and considered by your instructor uren bd tns dhe 41,0 for f years at o percent AR, what would h the $41,000 for four years at 6 percent APR, what would her monthly payment be, using the information in Table 7-2 or on the Garman/Forgue companion website? Round your answer to the nearest cent. for a Loan in intermediate calculations to

Explanation / Answer

a. Yes she should be concerned as not reading the contract does not elivate the obligation which contract bestowed upon her as far as no fraudlent condition was given in contract or there is mutual error fact in it.

b. Lenders compute the interest to be paid based upon the rule of 78 and prepare a repayment shcedule accordingly with interest component being higher in earlier months. If Lauren pays early than lender may get a hit in their income component in the form of interest and thus Rule 78s allows them to charge penalty in such cases

C. Mentioned Table 7-2 not given so I cannot answer this, hope you understand.

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