Loan Finance Calculator: Learn To Use And Save On Cost

2007-03-08 10:33:40

( Financial )



Loan finance calculator is an effective tool to know how much you should spend monthly and how much you can save on your car loan finance, student loan finance, construction loan financing or mortgage financing.

You can purchase and learn to use your loan finance calculator. You need to be familiar with some basic keys which include the number of payments, periodic interest rates as a percentage, present value, periodic payment and future value.

Before starting your calculations, you should always make it a habit to clear the financial registers of your loan finance calculator even if you have just turned it on. Many loan finance calculators retain the previous input you keyed in. Once the register has been cleared, you are now ready to start calculating your financial loans.

When you solve mortgage financing calculations, keep in mind that the input for number of payments is the sum of all periodic payments. If you are going to get a 30-year mortgage and wish to pay monthly, the number of payments should be 360 (30 years multiplied into 12 payments per year).

Interest rates are always expressed as annual rate. Thus when solving for mortgage financing, it is important to keep the interest rate and the frequency of payment consistent. You have to divide the annual interest rate to the number of payments to be made during the year to get the periodic interest rate. Hence, if the annual percentage rate of your loan is 12 percent, your periodic interest rate should be 1 percent.

Don't forget to key into the loan finance calculator the proper plus (+) or minus (-) sign when entering the present value, periodic payment and future value.

If you enter the right information on your loan finance calculator, you should be able to calculate your savings and help allocate a proper budget for your loans.


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