1. **State the problem:** We need to determine the monthly payment for a loan based on the principal and interest, ignoring taxes and insurance. 2. **Formula used:** The monthly payment $M$ for a loan can be calculated using the formula: $$M = P \times \frac{r(1+r)^n}{(1+r)^n - 1}$$ where: - $P$ is the principal loan amount - $r$ is the monthly interest rate (annual rate divided by 12) - $n$ is the total number of monthly payments (loan term in years times 12) 3. **Important rules:** - Convert the annual interest rate to a decimal before dividing by 12. - Ensure $n$ is the total number of payments, not years. 4. **Intermediate work:** - Calculate $r = \frac{\text{annual interest rate}}{12}$ - Calculate $n = \text{loan term in years} \times 12$ - Substitute values into the formula and simplify. 5. **Explanation:** This formula accounts for the compound interest effect on the loan and spreads the payments evenly over the loan term. 6. **Final answer:** Use the formula above with your specific values for $P$, $r$, and $n$ to find the monthly payment $M$.