#Loan #repayment #calculator
Loan repayment calculator
Loan Repayment Calculator
Finally, if this calculator isn’t exactly what you are looking for then try one of 6 other loan calculators or 11 debt repayment calculators here including the popular debt snowball calculator. One of these calculators is certain to meet your needs.
How Much Will Your Monthly Payment And Interest Cost Be If You Pay Off Your Loan By A Certain Date?
Many people take out loans to buy homes, vehicles, furniture, and anything else they can finance. But that doesn’t mean it’s the smartest way to purchase items. Before you borrow money, consider the costs.
The definition of a loan is a thing that is borrowed, especially a sum of money that must be paid back with interest. The key point is you will pay interest for the privilege of borrowing money which will increase the total cost for the item you purchased.
This Loan Repayment Calculator will help you determine how much you will pay towardВ interest for the entire term of the loan, and it will also figure out how much interest you will save by accelerating your payment plan using bi-weekly payments.
How Frequently Should I Pay My Loan?
Most loan payments are made monthly. However, many loans will allow you to pay bi-weekly instead. This is particularly advantageous if you get paid every other week rather than monthly. That because if you repay your loan each time you get a bi-weekly paycheck it results in 26 payments, versus 24 semi-monthly payment periods, giving 2 extra payments.
If you choose to pay on a bi-weekly basis, it is as if you’re adding a 13th payment to your standard 12 payments. You’ll barely feel a difference between a standard, monthly payment schedule and a bi-weekly payment schedule вЂ“ except, of course, that you’ll be making two payments per month instead of one. The difference in cost will hardly affect your budget, but the acceleration in debt payoff can really help.
Keep in mind that making bi-weekly payments means you’ll pay less in interest over the course of your loan term reducing the total cost of your loan. Try this Loan Repayment Calculator to see how the numbers work for your situation.
Points To Consider WhenВ Accelerating Payments
If you can afford to makeВ extra payments, you will save thousands of dollars in interest in the long run. But before you arrange for making extra payments, take into consideration the following tips:
- Review your loan agreement to see if your lender imposes penalties on prepayments (most lenders don’t).
- EnsureВ extra paymentsВ are applied toward principal. If your extra payment is applied as credit to your next scheduled payment, then it willВ defeat the purpose. Be sure toВ ask your lender how extra payments will be applied if you are unsure.
- Before you arrange for a bi-weekly payment schedule, review your budget and check to see if you can afford these payments (most likely you can).
- If you are accelerating your payments for the purpose of boosting your credit score alone, then rethink your strategy. Your credit score is more positively impacted by paying your loan regularly and on time for a longer period than by an accelerated repayment schedule.
Some people want to repay their loans before retirement so they can enjoy their retirement years debt free. But for most people, they are simply sick of paying interest on their loans and that is why they want to get out from under the debt trap.
When you repay your loan you’ll both make yourself attractive to lenders if you need credit again, and your debt-to-income ratio will also improve saving youВ thousands of dollars in interest. Paying off your loans increases your financial security by removing debt leverage resulting in peace of mind that affectsВ many parts of life: your health, relationships, opportunities, and more.
To summarize, the purpose of this Loan Repayment Calculator is to determine how much you need to pay to reach your goal. The faster you’re able to become debt-free, the more wealth-building you can undertake.