This sort of problem is most easily worked using a financial calcualtor or app. Attached is the result of using the financial app available on a TI-84 calculator for finding future value. The arguments to the function are ...
... N — number of payments: 3
... I — annual interest rate (%): 4.95
... PV — present value: the value of the loan, 125,600
... PMT — payment amount: -1500. The sign is negative because this is money we're paying out
... P/Y — payments per year: 12 (payment is monthly)
... C/Y — compounding per year: 12 (interest is compounded monthly)
After 3 payments, the balance is $122,642.13.
