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The formula for calculating your loan payment depends on whether you choose an amortizing or interest-only loan. Examples of amortizing loans include car loans, mortgages and personal loans.
As long as you know the principal, loan term and interest rate, you should be able to estimate your monthly payment — and the total interest you will pay. Use an auto loan calculator.
Note that the interest rate is commonly referred to as an annual percentage rate (e.g. 8% APR), but in the above formula, since the payments are monthly, the rate must be in terms of a monthly percent. Converting an annual interest rate (that is to say, annual percentage yield or APY) to the monthly rate is not as simple as dividing by 12; see ...
The fixed monthly payment for a fixed rate mortgage is the amount paid by the borrower every month that ensures that the loan is paid off in full with interest at the end of its term. The monthly payment formula is based on the annuity formula. The monthly payment c depends upon: r - the monthly interest rate. Since the quoted yearly percentage ...
Many financial experts would advise you to not spend more than 10% to 15% of your net monthly income on car payments. For total vehicle costs, which include loan payments and auto insurance, you ...
First, there is substantial disparate allocation of the monthly payments toward the interest, especially during the first 18 years of a 30-year mortgage. [3] In the example below, payment 1 allocates about 80-90% of the total payment towards interest and only $67.09 (or 10-20%) toward the principal balance. The exact percentage allocated ...