Before applying for a loan, it is important to calculate how much you will have to pay monthly. You also need to know how long the loan payments will take. In order to correctly calculate the loan term, you must follow some rules.
It is necessary
Loan calculator program, a regular calculator
Instructions
Step 1
Use the services of a bank loan manager. Based on your loan agreement, he will calculate the loan term based on the loan amount and monthly payments. Please note that the calculations will include the values of additional payments for loan servicing.
Step 2
Take advantage of the special program "Loan calculator", with which you can determine the term of the loan by entering the value of the loan amount, monthly payments and other necessary information.
Step 3
Calculate the loan term using the formula. You will need a good knowledge of mathematics. It is calculated by the formula: s = p * (N + 1) / 24, where s is the amount of interest, p is the annual interest rate, N is the loan term, in this case, in months. Accordingly, the loan term N is calculated by the formula N = (S * 24 / p) - 1.
Step 4
Start calculating. To do this, you will need: - the value of the amount to pay off the principal debt - it is the same every month, indicated in the contract; - the actual amount of the loan and interest on them; - the annual interest rate.
Step 5
You can consider the calculation of the loan term using a specific example. Let's say the interest rate p = 18%, the sum of interest s = 27, 75 - this value should be suggested to you by the bank manager. So the loan term N = 27, 75% * 24/18% - 1 = 36 months.
Step 6
Thus, the loan term comes out equal to 36 months under the conditions considered. This scheme for calculating the term of the loan works with differentiated payments, when the same amount is paid on a monthly basis to pay off the debt.
Step 7
With an annuity scheme, the calculations are more complicated. In this case, you need to take into account the amount of the loan, the coefficients of monthly payments, as well as the rise in the price of the goods. If you wish, you can deduce the value of the loan term from the formula: k = an * (a - 1) / (an - 1), where k is the monthly payment ratio, a is the denominator of the progression, calculated as follows - 1 + p / 1200, p - annual interest rate, n - loan term, in months.
