![]() Refinancing is more commonly associated with home mortgages, car loans, or student loans. Terms and conditions of refinancing vary widely. Loan refinancing involves taking out a new loan, usually with more favorable terms, in order to pay off an old one. Auto Loan Calculator - Designed specifically to help with buying a car.Related Mortgage Calculator | Mortgage Payoff Calculator | APR Calculator.Amortization Schedule - Create a loan amortization schedule and make arbitrary extra payments.The downside is that if you don't have the discipline to make the extra payments, you'll end up paying more interest overall. The benefit of this approach is that if you run into hard times, you can stop making the extra payments. Some people prefer to get loans with longer terms and make regular extra payments. This assumes that there are no penalties for making extra payments. You'd also end up paying about $600 less interest overall. For the same loan amount and interest rate, if you pay $60 extra each month or $360.57, the term is calculated to be 4.03 years (instead of 5 as in option A) - meaning you'd pay off your loan almost 1 year early. For example, refer back to the example for Option A. Use this option if you want to pay off your loan early by making extra payments. Option D: Solve for the Term using NPER() However, this option may be useful for academic purposes. It isn't as common to solve for the interest rate because you may not have any control over what your interest rate can be (other than shopping around for the best one). Option C: Solve for the Interest Rate using RATE() Keep in mind that there may be other fees in addition to standard loan payment (principal+interest), such as insurance, taxes, etc.įor example, with a $250 monthly payment, if you got a 5-year loan with a 6% interest rate, the loan amount is calculated to be $12,931.39. Use this option when you know how much you can afford to pay each month and want to find out how large of a loan you might get. Option B: Solve for the Loan Amount using PV() The total interest paid over the life of the loan is calculated to be $3,034.15. For example, a 5-year, $15,000 loan at 7.5% interest results in a monthly payment of $300.57. Use this option when you know how much you need to borrow and want to find out how the interest rate or term affects your payment. ![]() Option A: Solve for the Loan Payment using PMT() If you entered your current balance in the Loan Amount, then for the Term enter the number of years you have left until your loan is paid off. Auto loans are usually between 2 and 5 years.
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