Bob and Mary would owe the lender $145,803, after 60 monthly payments (12/15/2004), if they do nothing but continue to make their regular payments.
If Bob and Mary decide to pay the $15,440, by adding it to their balance (as a negative prepayment) on the twenty fourth payment, the balance is the same after the 60th payment (12/15/2004) that is, $145,803. By paying the IRD Bob and Mary saved nothing. This should be no surprise because that is what the IRD calculation is meant to do, compensate the Lender for an early release from the 5 year term agreement.
The MORTGAGE2 PRO program handles that calculation automatically as shown below.
Simply highlight the 24th payment line and click on the renewal key icon and the renewal screen appears below;
What could be simpler?