How do you count car loan interest?
Is there a way to count how much I will pay in car loan interest? I want to make sure that my loan is worth it before I get in over my head, but I'm not very good with numbers.
To count the amount of money that your car loan interest will cost you, you can calculate the total interest paid by hand using the following formula: Monthly Payment = principal balance x (monthly interest rate (1 + monthly interest rate) loan term in months) / ((1+monthly interest rate)loan term in months - 1)
Then, multiply the monthly payment by the number of payments you will make. The result will be the total amount that you’ll pay for your loan. To find the total interest paid, simply subtract the principal from this amount.
If you are unsure about any of the values in the equation, you can talk to your lender to learn more about your loan agreement. Your lender can also usually tell you your monthly payment amount!
If this seems like a lot of work, you can use Microsoft Excel or Google Sheets instead! To find the total interest charges on your loan, simply type in the following formula: =CUMIPMT(yearly interest rate/12, duration of the loan in months, the loan amount before fees and interest, 1, the total number of payments you will make, 1)
Then, press the enter button to see the total interest that you will pay on the loan.
If you do decide to find a new loan, why not refinance with the Jerry app? Just download the app to compare quotes from multiple lenders without the hassle of researching and sending documents to potential lenders. Jerry’s app instantly connects you with top companies to help you find a loan that best meets your needs.
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