The loan calculator is an indispensable tool for anyone thinking about taking out a loan. Thanks to it, you can protect yourself from choosing a high interest rate loan. This solution also helps to accurately calculate the costs of borrowing, which is important because in advertisements banks usually focus on the best way to describe their offer and get a client, not necessarily offering them affordable conditions.
1. How to calculate the loan installment amount?
2. Credit calculator and the type of installments
The possibility of avoiding the signing of a loan agreement on unfavorable terms that the loan calculator gives you most often turns out to be a great happiness, especially when the loans taken for many years costs can be really big. After entering a few details, the tool immediately displays to the user in the form of an understandable graph not only the total cost of the loan together with the amount of interest, but also the amount and amount of installments. Thanks to this, you can, for example, check whether it will be the best solution to take out a loan for a dozen or so years, or maybe it is better to focus on other offers.
How to calculate the loan installment amount?
Using the calculator to accurately calculate the amount of the installment is child’s play. First, open the loan calculator and enter the loan amount in the appropriate window. It does not matter whether it is a consumer loan or a loan for the purchase of real estate. In both cases, the calculations will be just as valid as long as you specify the correct interest rate and determine the time at which the loan will be repaid. The calculator will also allow you to calculate the commission amount. While banks or financial companies informing about its amount provide the amount in PLN, no one has a problem considering its amount when calculating the total cost of the loan. Most often, however, the commission is determined in percentage of the amount you want to borrow. It is therefore much easier to calculate it if you use tools like the calculator. In addition, you can make a simulation depending on whether the commission will be paid separately, deducted from the amount paid by the bank or even added to it. Such detailed information makes it possible to quickly verify the amount of APY for each loan, without the need to use advisors who are more familiar with finance.
It is also worth remembering that if the APY of the loan is low, it automatically becomes more attractive. If, however, the result obtained in the loan calculator indicates that a loan has a very high APY, it is best to immediately quit applying for it and instead look for a better offer.
A loan calculator and the type of installments
One of the most interesting functions of the calculator is the ability to choose between equal and decreasing installments, but in practice in most cases, equal installments are more profitable. Not every bank customer will also be given the opportunity to take a larger loan if he wants to choose decreasing installments. This is particularly evident in the case of loans granted for the purchase of a flat, where most young people are forced to choose equal installments because they have low creditworthiness so that the bank can grant them loans with different parameters. So before you sign a mortgage contract or take out a loan for a high amount, you should not only use this loan calculator, but also read about the differences between the available types of installments.