![]() ![]() If you're shopping for a vehicle, using a car loan amortization calculator to play around with the numbers can be helpful as you set your budget. The loans can extend for a very long period, producing a 72-month schedule. The longer your loan term, the more payments there are on your amortization schedule and the more interest you'll pay altogether, even though what you pay per month may be less than you’d pay with a shorter term. Your auto loan's interest rate also matters, since a higher rate means more interest paid in total over the life of the loan. If you have to pay taxes, title fees, and other costs at signing that are rolled into the loan, that can affect the amount that's amortized. Offering a vehicle for trade-in could also reduce the amount you have to finance and thus lower your payments. The more you put down on an auto loan, the less you'll have to finance and the lower your monthly payments may be. What Factors Affect Auto Loan Amortization? There are a number of factors that can influence car amortization when you’re using financing to purchase a vehicle. By the time you reach your 60th and final payment, $338.53 would go to the principal while just $1.13 would go to interest. If you plug the numbers into an amortization schedule auto loan calculator, you'll see that when you make your first payment, $278.13 would go to the principal while $61.47 would go to interest. Assuming a 4% interest rate, your monthly payments would work out to be $339.60. You plan to put down $2,500 on the loan and you'll pay $940 in taxes and fees at signing, leaving you with a total financing amount of $18,440. For example, say you want to take out a $20,000 loan with a 60-month term.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |