how to figure interest on a car loan

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Online amortization calculator

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  • How do you calculate auto loan interest payments?

  • Multiply the monthly payment by the balance of your loan. However, for the first payment, this will be your total principal amount. The amount you calculate is the interest rate you will pay for your first month鈥檚 payment. To calculate future auto loan interest payments, you will need a different calculation:

  • How to calculate the interest rate on a student loan?

  • Here is the calculation: Divide your interest rate by the number of monthly payments per year. Multiply the monthly payment by the balance of your loan. However, for the first payment, this will be your total principal amount. The amount you calculate is the interest rate you will pay for your first month鈥檚 payment.

  • How much does it cost to finance a car with 6% interest?

  • The monthly payment on a five-year loan for $40,528 at 6% interest would be $782.52. You would pay $47,011.19 in monthly payments. Throw in the 10% down payment, and the car costs $51,514.19. If stretched to an 8-year term, the monthly payment on that $40,528 loan at 6% interest drops to $532.60 a month. The loan payments would total $51,129.20.

  • Where does the interest go on a car loan?

  • With most car loans, part of each payment goes toward the principal (the amount you borrow), and part goes toward interest. The interest you pay each month is based on the loan’s then-current balance.

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