If you’re interested in financing a new vehicle for your Gretna drives, we at Leson Chevrolet Company, Inc. are here to help! Our finance team is committed to making the process of finding your next ride as smooth and stress-free as possible, and part of that is helping you draw up a realistic budget. In addition to the cost of the car, you’re going to want to factor interest in your monthly payments, but how does the interest rate affect the total amount owed? We’ve got all the details on how to calculate your interest rate below – check it out!
The first step in learning how to calculate auto loan interest is to understand exactly how car loan interest rates work. When you buy a new vehicle on credit, your lender essentially owns your vehicle until it’s fully paid off. The interest rate is a monthly fee that you pay the lender for using their money to buy your car. Your particular interest rate will vary based on four key factors:
Now that you know how an interest rate works, let’s look at how to calculate the interest rate on your first payment. Just make this calculation:
The resulting number will be the amount of interest you pay in the first month of owning your new Marrero vehicle.
Once you make your first payment, you’ll need to calculate the interest you pay going forward for your loan term. Keep in mind that this is an estimate since there are always human rounding errors, but it should give you a basic idea of what to expect from your car loan interest rates. Here are the calculations to make:
Now that you know how to calculate the interest rate on your car loan, feel free to contact our office with any questions! You can also stop by the Harvey dealership to talk to a member of our finance team in person—we’re conveniently located near Belle Chasse, so drop by today!
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