Personal loan calculation

Personal loan calculation

If you have a loan contract or are about to sign a new similar contract, knowing how to perform the personal loan calculation could be very convenient. This operation can be used to check the contractual conditions set by the bank or financial institution to which you have turned: the amount of the installments depends on various factors, such as their frequency and the interest rate. Using the numerous calculation tools available on the internet, you can also compare different loan offers and choose the one that best suits your economic conditions.

Among the many calculation tools, the simplest to use are those that provide the interest rate to be incurred during the loan repayment period: we have explained how it works in this in-depth analysis. Here, instead, we want to analyze another type of online site, which allows instead to perform more complex calculations to get an overall idea of ​​the operation of the loan.

Among the most widespread solutions, there is the calculation of the loan installment : these calculators allow you to obtain a useful result by inserting little information, easy to find, about your financing. Therefore, keep data such as the total amount of the loan, its overall duration and above all the APR , the Global Effective Annual Rate, which records the interest rate imposed by the bank plus the other expenses required for opening and closing loan repayment.

Another possibility is to calculate how much the total sum to be repaid will be , ie the sum of the loaned capital plus the total expenditure in interest. In fact, these are usually expressed as a percentage, so it is difficult for the consumer to understand in the end what they will actually amount to. That is why it is often possible to isolate only the expense in interest: you can thus compare the different offers and see which bank will ask you less.

Finally, one last option for calculating personal loans is the more advanced one, which gives the user the entire loan amortization schedule . What does it mean? Not only will the total expenses and the sum of the interests be clarified, but the details of all the installments to be paid will be offered in addition to the residual capital to be paid each time and the interest expense for that single installment.