If you have a good credit standing, your interest rate will likely be lower than someone with a bad credit score. Shop around and compare the dealers and finance options to see what kind of interest rate you can get. Interest rate - the interest rate that you will be paying for your car loan. Monthly payment - the amount of money that you can afford to pay each month. How to use the reverse car loan calculator? Therefore, there are three variables that determine what kind of car you can buy, the monthly payment, the terms, and the interest rate. However, if you want to shorten the loan terms to a 3-year term, you will only be able to afford a car for around $17,193.23. Let's say if you are willing to make $500 as a monthly payment towards a car with a 5-year term and an interest rate of 3%, then you can afford a car for around $27,826.18. If you have an old car that you can trade-in, or make a down payment towards the purchase, you can use the car affordability calculator to determine what kind of car you can buy. The reverse auto loan calculator will calculate how much of a car you can afford based on the monthly payment that you are willing to make. There are other costs in financing the purchase of a car such as sales tax and other fees. Of course, the monthly payment would be much larger for new cars if you are putting down the same amount as the down payment, which means you would need to save more each month. If you are buying a used car, the maintenance costs will be higher than a new car. You want to be sure that you have set aside a portion of your savings for auto costs. When planning how much monthly payment you can afford for your car, you need to keep in mind there are other costs associated with owning a car such as auto maintenance costs, auto insurance, and gas costs.
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