Monthly Payments
Monthly Payments
I don't know if this is the right spot, but this might help some people.
Okay, people have been asking how much it would cost, and the only response the guy got was what people PAY for their monthly.
So I made this to help, I will add more soon, but this is an example.
A monthly payment is based on how many years you want to pay it off and how much money you put down on the car AND how much the car its self costs. Don't forget APR percentage folks!
My example:
Rate: 6.9%
Term: 60 Months (5 Years)
Car Price: $31,995 USD
Down Payment - Monthly Payment:
$1,000 - $612.27
$2,000 - $592.52
$3,000 - $572.76
$4,000 - $553.01
$5,000 - $533.26
$6,000 - $513.50
$7,000 - $493.75
$8,000 - $473.99
$9,000 - $454.24
$10,000 - $434.49
^^^100% Accurate^^^ *My area only*
And this might help of you want to find your APR or payments out. *SOURCE: Wikipedia
An effective annual interest rate of 10% can also be expressed in several ways:
* 0.7974% effective monthly interest rate
* 9.569% annual interest rate compounded monthly
* 9.091% annual rate in advance.
These rates are all equivalent, but to a consumer who is not trained in the mathematics of finance, this can be confusing. APR helps to standardize how interest rates are compared, so that a 10% loan is not made to look cheaper by calling it a loan at "9.1% annually in advance".
The APR does not necessarily convey the total amount of interest paid over the course of a year. APR, in the simple case of a loan with no fees (or, say, a credit card), is the monthly interest rate multiplied by 12.
In the case of a loan with no fees, the amortization schedule would be worked out by taking the principal left at the end of each month, multiplying by the monthly rate and then subtracting the monthly payment. This can be expressed mathematically by
p = \cfrac{P_0*r^{(n+1)}}{\sum_{l=1}^n r^l}
where:
P0 is the initial principal
r is the percentage rate used each payment
n is the number of payments
This also explains why a 15 year mortgage and a 30 year mortgage with the same APR would have different monthly payments and a different total amount of interest paid. There are many more periods over which to spread the principal, which makes the payment smaller, but there are just as many periods over which to charge interest at the same rate, which makes the total amount of interest paid much greater. For example, $100,000 mortgaged (without fees, since they add into the calculation in a different way) over 15 years costs a total of $193,429.80 (interest is 93.430% of principal), but over 30 years, costs a total of $315,925.20 (interest is 215.925% of principal).
In addition the APR takes costs into account. Suppose for instance that $100,000 is borrowed with $1000 one-time fees paid in advance. If, in the second case, equal monthly payments are made of $946.01 against 9.569% compounded monthly then it takes 240 months to pay the loan back. If the $1000 one-time fees are taken into account then the yearly interest rate paid is effectively equal to 10.31%.
The APR concept can also be applied to savings accounts: imagine a savings account with 1% costs at each withdrawal and again 9.569% interest compounded monthly. Suppose that the complete amount including the interest is withdrawn after exactly one year. Then, taking this 1% fee into account, the savings effectively earned 8.9% interest that year.
OFF-TOPIC, In case you wanted you know the MPG for the Evo IX-
18 MPG City
24 MPG Hwy
Okay, people have been asking how much it would cost, and the only response the guy got was what people PAY for their monthly.
So I made this to help, I will add more soon, but this is an example.
A monthly payment is based on how many years you want to pay it off and how much money you put down on the car AND how much the car its self costs. Don't forget APR percentage folks!
My example:
Rate: 6.9%
Term: 60 Months (5 Years)
Car Price: $31,995 USD
Down Payment - Monthly Payment:
$1,000 - $612.27
$2,000 - $592.52
$3,000 - $572.76
$4,000 - $553.01
$5,000 - $533.26
$6,000 - $513.50
$7,000 - $493.75
$8,000 - $473.99
$9,000 - $454.24
$10,000 - $434.49
^^^100% Accurate^^^ *My area only*
And this might help of you want to find your APR or payments out. *SOURCE: Wikipedia
An effective annual interest rate of 10% can also be expressed in several ways:
* 0.7974% effective monthly interest rate
* 9.569% annual interest rate compounded monthly
* 9.091% annual rate in advance.
These rates are all equivalent, but to a consumer who is not trained in the mathematics of finance, this can be confusing. APR helps to standardize how interest rates are compared, so that a 10% loan is not made to look cheaper by calling it a loan at "9.1% annually in advance".
The APR does not necessarily convey the total amount of interest paid over the course of a year. APR, in the simple case of a loan with no fees (or, say, a credit card), is the monthly interest rate multiplied by 12.
In the case of a loan with no fees, the amortization schedule would be worked out by taking the principal left at the end of each month, multiplying by the monthly rate and then subtracting the monthly payment. This can be expressed mathematically by
p = \cfrac{P_0*r^{(n+1)}}{\sum_{l=1}^n r^l}
where:
P0 is the initial principal
r is the percentage rate used each payment
n is the number of payments
This also explains why a 15 year mortgage and a 30 year mortgage with the same APR would have different monthly payments and a different total amount of interest paid. There are many more periods over which to spread the principal, which makes the payment smaller, but there are just as many periods over which to charge interest at the same rate, which makes the total amount of interest paid much greater. For example, $100,000 mortgaged (without fees, since they add into the calculation in a different way) over 15 years costs a total of $193,429.80 (interest is 93.430% of principal), but over 30 years, costs a total of $315,925.20 (interest is 215.925% of principal).
In addition the APR takes costs into account. Suppose for instance that $100,000 is borrowed with $1000 one-time fees paid in advance. If, in the second case, equal monthly payments are made of $946.01 against 9.569% compounded monthly then it takes 240 months to pay the loan back. If the $1000 one-time fees are taken into account then the yearly interest rate paid is effectively equal to 10.31%.
The APR concept can also be applied to savings accounts: imagine a savings account with 1% costs at each withdrawal and again 9.569% interest compounded monthly. Suppose that the complete amount including the interest is withdrawn after exactly one year. Then, taking this 1% fee into account, the savings effectively earned 8.9% interest that year.
OFF-TOPIC, In case you wanted you know the MPG for the Evo IX-
18 MPG City
24 MPG Hwy
Last edited by Sev; Jul 9, 2008 at 05:35 PM.
