Often, those loans that banks widely advertise under the guise of cheap are not so profitable. Therefore, before taking a loan, you must calculate and check whether it is profitable yourself, and only after that contact the bank. But usually borrowers simply do not know how to calculate the overpayment on a loan.
It is necessary
- calculator
- detailed information on the loan
- notebook and pen
Instructions
Step 1
Determine the form of loan repayment. It is important to remember that the benefits of a particular loan may depend on its repayment. If the loan is paid in equal installments, then, as a result, the overpayment of the loan increases. With differentiated payments, when initially the monthly payments are quite high, but they gradually decrease, the overpayment on the loan is usually lower. When calculating the differentiated payments, a widespread scheme is usually proposed: the initial loan amount is divided into equal parts, while interest is charged on the balance of the loan base. This scheme is beneficial and allows you to overpay at a minimum, but is not very popular in our country.
Step 2
Find out all the required loan payments. In order for all the calculations to be accurate, it is necessary to find out the nominal interest rate, the size of both one-time and monthly payments, which are taken by the bank, as well as the form in which all these commissions are charged.
Step 3
Add up all the numbers you get. First you need to get the amount of all expenses that will accompany the loan. Further, it must include the costs of insurance and appraisers. If the amount received is divided by the loan term, which is usually calculated in months, you can get an approximate monthly payment.
Step 4
Divide the sum that resulted from the addition of all planned expenses by the original loan amount. Thanks to this, you can find out the rise in the cost of the loan and how profitable it is.
Step 5
Use an online loan calculator that helps to simplify all calculations. It can usually be found on the banks' official websites. This calculator assumes the input of all known parameters for the loan - the amount, interest rate, commissions and other payments, and the total loan amount will be calculated automatically by this program.
