Car loan calculators take into account the amount of the auto loan, the term of the auto loan, the annual interest rate and when the loan begins, as stated by Bankrate. When entering the loan amount, buyers subtract the amount of their down payment from the full amount of the loan. Buyers can also decide whether to enter the term of their loan in months or years.Continue Reading
Once all of the applicable information is entered, users can see their estimated payment per month and see an amortization schedule that shows how much of each payment goes to interest and how much goes to principle. The schedule also displays the balance after each payment.
When applying for a car loan, buyers should make sure their credit history is accurate, as stated by Edmunds. They can check their credit by requesting a copy of their credit report from one of the major credit bureaus.
The borrower's credit history and income both play a role in how much he or she can be approved for and what the interest rate of the loan is. It is important to shop around at different financial institutions to find the best interest rate. The conditions of the loan vary depending on whether the prospective automobile is brand new or used.Learn more about Financial Calculations