I would like to know what the monthly payment would be for a 72-month car loan at 5.99% for the following car prices:
$11,912.35 with a warranty and $10,139.35 without a warranty
It's a bonus if you show how you calculated the monthly figures.
2010-04-23T17:33:23Z
I can afford the car. For some reason I don't understand, even though my credit score at the dealership came up as 830, they would only approve me for a 6 year loan when I wanted a 4-year loan. They said the Finance Company (WELSFARGO), considering the current economy in the US, set the loan for 6 years so the payments would be "affordable". I want to pay it off in 4 years, to save the interest (loan does not have a prepayment penalty).
Sin nombre2010-04-23T17:26:41Z
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You can't afford the car if you need 6 years of payments .
$10,139.35 without a warranty comes to $168 per month . I used the Cars. com calculator . The extended warranty scam would cost as much as most major repairs .
The calculations are complex . However , the simple formula is $16.57 per thousand @ 5.99 %
Any loan company and vehicle dealership that will ONLY write a 6 year loan and tell you that it makes the payments more "affordable" are trying to rip you off. It may make the payments less, but definitely not more affordable. It costs you more, much more.
The less time it takes to pay off a loan, the less interest you pay. With a FICO credit score of 830, you should RUN, not WALK away from the dealership and WELSFARGO as quickly as possible and find someone honest to deal with. I'd recommend that if you are not currently a member of a credit union, join one immediately. Many credit unions currently have car loans with rates as low as 3.99%. Your credit score should qualify you for their best rate. This Credit Union, for example has 3.99% for both used and new loans up to $100,000 and the term can be anywhere from 1 to 5 years. You get to choose the term that best suits your financial situation.
For example, a $12,000 loan at 5.99% for 6 years has a payment of $198.82. Over the term of the loan, you'll pay $14,315.04. The same $12,000 at 3.99% for 3 years requires a monthly payment of $270.89, just $72 more than the 6 year loan. That is only $16 a week. You should be able to swing an extra $16 a week just by eating out less often. But over the loan term, you pay a total of $13,003.72, more than $1,300 less than the longet term loan. The longer you use the loan company's money, the more you pay them.