Auto Loan Calculater – No More Guessing Games
An auto loan calculater helps you in many ways. If you don’t know what type of car you can afford (e.g., used, leased, new), you can use a loan calculator to calculate how much the car price value should be based on your intended loan amount, the monthly payment you can afford and the loan terms. On the other hand, if you know the car price, then you can easily calculate the monthly loan payments and see if you can afford that. You can also use a car loan calculator as a car lending estimator to estimate the maximum car loan amount you can avail.Calculating for a Loan AmountDrivers Lane™ has come up with a great way to estimate the maximum loan you can ask for your car. First, determine your credit rate. A good credit rate would be a score of about 700; a score of 525 indicates a bad credit rate. Second, using Driver Lane’s Income Factor Sheet, calculate your verifiable gross monthly income by your income factor (A). Income Factor (A) | Formula | Good Credit | 10 | Gross Monthly Income | = | Fair Credit | 9 | Multiply by Factor (A): | x | Slow Credit | 8 | | | Bad Credit | 7 | Maximum Loan: | Real Bad Credit | 6 | | |
Third, subtract the debts or loans you may have from 50% of your monthly income and then multiply it by your Debt Factor (B). Debt Factor (B) | Formula | Good Credit | 50 | ½ Gross Monthly Income | = | Fair Credit | 45 | Rent/Mortgage | - (minus) | Slow Credit | 40 | Credit Card Payments | - (minus) | Bad Credit | 35 | Disposable Income | - (minus) | Real Bad Credit | 30 | Multiply by Debt Factor (B): | x | | | | | | | Maximum Loan: |
The lesser amount indicated after doing steps 2 and 3 is a good estimate of the loan you can avail. Written by: Katrina Marion
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