The payoff amount of $4700 means that if you wrote a check for that amount and gave to them right now, the loan will be paid off. Basically, that is what you would pay if you paid it off right NOW.
But you probably dont have the money right now, so here is what you do:
First, you need to crunch the numbers to see that the loan is costing you:
If your interest rate is 15% (0.15), then they divide that by 365 (the number of days in the year) to get: 0.00041. Now everyday your balance is multiplied my that number. So, on the first day, it is 4700 X 0.00041=4701.93. on day 2, it is 4701.93 X 0.00041=4703.86. etc.
Basically this boils down to your bill going up by about $60 per month. So, every time you pay $88, they add on about $60. Because of this, it is easy to pay forever without budging the balance.
When you add on insurance and stuff on there it becomes even higher, because insurance can be something like 2% of your balance at the end of every month (which would work out to be another 24% per month!).
If I were you, I would call and tell them to take off the insurance (insurance is to pay for the loan if you die, but if you die, you probably won't care about the loan. It may also make it so that you don't have to make payments (but the intrest would incur) if you become unemployed or sick).
The next thing is to ask them what is the total cost of the loan based on the current payments schedule and interest rate. The amount will make you gasp.
The next step is to make bigger payments (like $470) so that you can pay off the loan quicker.
In they 10000000 pages of fine prints, they tell you how interest and stuff are calculated. If you have any more questions, let me know!
