Finance
When you take out a loan for a new vehicle for your Farragut commute, you’ll have to pay back the loan over time plus interest. Your total monthly payments will depend on how much the interest rate is. To find out how much the interest rate affects your monthly payments, learn how to calculate auto loan interest with the experts at Ole Ben Franklin Motors. Then, visit us for any of your car-buying questions.
Before we learn how to figure interest on a car loan, it’s important to understand the basics of what an interest rate is and the factors that affect it. When you take out a loan, you use credit to purchase a vehicle. The lender then technically owns the vehicle until you pay it off. So, the interest rate you pay on top of the loan is essentially a fee for using the lender’s money to buy the vehicle.
So, to learn how to calculate the interest rate on a car loan, you’ll need to know what kinds of factors affect the interest rate:
Your first payment will be slightly different from all of the rest of your payments on your auto loan. Here’s how you figure out how much your first payment will cost:
After you make your first payment, you’ll then need to determine how much you’ll pay going forward. If you’re like many Sevierville drivers who are new to taking out a loan, here’s how to do it:
You won’t always get a perfect number every time, but the goal is to get as close as you can. Use our loan payment calculator at Ole Ben Franklin Motors to help give you an estimate if you get stuck, and visit us in Knoxville for all of your finance questions.
For more car-buying questions and concerns, reach out to the finance center at Ole Ben Franklin Motors. Contact us online or visit us in Knoxville for a consultation.
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