In addition to the installments, borrowers incur further costs. Which of these are and how they are calculated, answered the following article.
Calculate payday loan costs
If you take out a payday loan, you have to take into account the monthly installments and other costs. Such as the interest, processing fees and costs for any additional services. To calculate the monthly costs, term, special repayments and other arrangements made in advance with the financial institution are also required. If all this is available, the credit can be calculated. For this purpose, the interest for the entire duration is first calculated, for which a simple rule of thumb serves:
- – Interest rate times loan amount and maturity years
The result must now be added only to the loan amount and the resulting processing fees. Finally, the total is divided by the duration of the loan. Please note: specify the duration in months and round off the total for a better overview. The latter is not absolutely necessary, because with this formula all credit sums can be calculated. This is especially useful for the credit comparison.
Credit comparison made easy
After the total has been divided by the duration of the loan, borrowers receive the monthly installment to be paid. This makes sense in the first place, of course, to keep track of the often opaque conditions. However, the formula can also be used to compare loans quickly and easily. If you have an offer, you can use the above formula to calculate the final cost and get a better overview. Nevertheless, not all credit comparisons indicate the actual costs. Often, additional costs are hidden in the contract, which must be considered.
The formula can also be used to calculate, for example, which loan amount is the maximum possible, how much can be saved by a better interest rate and which cost points have the greatest impact on the final loan amount. Real estate loans can also be calculated with a few additional calculation steps.
This is how a real estate loan can be calculated
The calculation of a real estate loan is very easy. All you have to do is add a few extra costs to the bill. The amortization rate, for example, or the special repayment. Also, the value of the property is important and may be directly included in the above formula. Since the calculation can be quite complex here, it is advisable to consult a specialist.
By the way: There are numerous loan calculators for different types of loans on the net. These are a useful alternative to manual billing and are a good option, especially for special loans. However, a simple installment loan can be easily calculated by yourself.