Saturday, January 2, 2010

About New and Used Car Loans

Before agreeing to a new or used car loan, it is important to find the best deal on the car or truck of your dreams. Finding a great deal requires preparation which is what a car finance calculator can offer. Online car finance calculators are available for plugging in numbers regarding a new or used car loan and estimating the monthly payment for the vehicle based on various factors including interest rate, down payment amount and total purchase price of the car.

The car finance calculator gives the consumer back the power to make the most educated decision when choosing a loan for their new car. Too many consumers walk into a car dealership with an idea of what vehicle they want but little idea of the numbers involved in calculating the monthly payment. Financing a car is not as simple as taking the purchase price and dividing that number by the total number of repayment months, unless the car can be financed with a 0% interest rate.

Budgets are an important part of affording the luxuries people want. If a certain amount of money is allotted in the budget for a new car payment, the car finance calculator can offer a total purchase price amount for the consumer to use a shopping limit. For instance, the consumer can use a car finance calculator to plug in a purchase price, estimated interest rate amount and total length of repayment. The amount calculated for the monthly payment will changed if this information is changed. Once the consumer finds a monthly payment they are comfortable paying, the purchase price will be there as a guide.

Repayment options are often used to lower the monthly payment amount required by the lender. If the consumer is sure they want a $30,000 car, the lender may offer a 72 month repayment to push them into the loan at a lower monthly payment. however, longer repayment terms mean the consumer will be repaying a larger amount for the car. The less time the loan spends in repayment, the less money the total purchase price will be. This is another way a car finance calculator can aid the consumer in taking back the power from the lender and dealership.

Other important features of an advanced car finance calculator include the ability to see how much money will be saved if different parts of the loan are altered. This could include reductions in interest rate, increased down payment amounts and shortening the repayment term for the loan. While the consumer may find out they can afford less for the total purchase price, the car will be repaid in a shorter term which is fantastic for the credit rating and the consumer can always trade in the car after the vehicle is repaid.

Car finance calculators can only estimate the total monthly payment based on the information and numbers provided by the user. For a more accurate calculation, the consumer can ask a local car dealer to run their credit application and return a pre-approved interest rate amount.

Car Finance Calculator

A car finance calculator can be a helpful tool when trying to determine the optimal interest rate, car loan amount and payment term details for the purchase of a new or used car. The Internet provides a fantastic starting point for a car loan calculator search. With a few bits of information and a couple of mouse clicks, the consumer can determine how much car they can afford before beginning the new car search.

A car loan is there to help the consumer afford a vehicle they would otherwise not have the money to buy with one lump sum payment. Loans are available for both new car purchases and used car purchases. A down payment may be required when buying a new, or new to you car. This will often be determined by the credit rating of the buyer. Other factors that may be taken into consideration include the purchase price of the car and income of the buyer.

When searching the Internet for a car finance calculator, it is important to find the right type of calculator. Financial support with mortgage, commercial and credit card calculators are also available, but these are not created for use as car finance calculators. Other names for a car finance calculator include an auto loan or car loan calculator.

The use of a car finance calculator will help the consumer judge what type of car they can purchase and the maximum amount of a loan they can afford monthly. The most common fields used in a car finance calculator are total purchase price, interest rate of the loan and the length of time desired for repayment. The most common repayment time frames are 36 months, 48 months and 60 months. In recent years, 72 month loans have become popular for consumers who wish to purchase vehicles with a higher purchase price for a lower monthly payment. The longer the repayment term, the more money the consumer will pay in total for the new car.

Some advanced car finance calculators will also include a field for down payment amount or trade in car value. The less money the consumer finances, the lower the payments will be and the shorter the repayment period can be set. In cases of negative equity in a trade in car, the amount of money financed could be higher than the purchase price for the car. Advanced car finance calculators may also provide information about the loan if it were changed. For instance, if the consumer chose a 36 month repayment instead of a 48 month repayment, these car finance calculators would show the consumer how much money they would save.

The consumer can use a car finance calculator to prepare for the trip to the car lot. Many people dread the time spent purchasing a car due to the pushy salesmen and loss of control during the financing part of the deal. When a car finance calculator is used before stepping onto the car lot, the consumer can say, "This is how much I can afford and this is the rate I want for the loan."

While a car finance calculator can give the consumer a helpful look into the amount they could potentially afford for a new car, there is no way to know for sure the interest rate the lender will offer once the loan is being prepared. The consumer can visit the car lot before using the car finance calculator for a better understanding of the interest rates the lender may offer.