PROBLEM:

Rob and Laura wish to buy a new home. The price is $237,500.00 and they plan to put 8% down. New Rochelle Savings and Loan will lend them the remainder at a 12% fixed rate APR for 30 years, with monthly payments to begin in one month. (Ignore taxes.) Suppose Rob wants to pay off the loan in 15 years. How much extra must he pay each month to do so?

ANSWER:
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