Posted in Loan Calculator, Loan Rates

Vehicle Loan Calculator


Vehicle Loan Calculator in New Zealand

Before visiting a loan provider, it is good to know your financial position. Having a clear picture of how much you can afford prepares you mentally for what to expect when applying for a vehicle loan.

Vehicle loan calculators available online; they are efficient easy to use. Loan providers in New Zealand have various types of vehicle loan calculators, but all their concepts are the same.
A vehicle loan calculator is an online tool used to estimate loan amounts and monthly repayment amounts.

Vehicle loan calculator New Zealand

How vehicle loan calculator works:

Depending on the estimate you require, online vehicle loan calculator performs two primary functions:

  • To calculate your monthly payment: for this function, key in the vehicle price, the number of months for repayment, interest rate, and payment plan (weekly, fortnightly or monthly) then make the calculation. The figure you obtain will be the estimated amount you will pay as instalments.

  • To calculate how much you can borrow: this function is convenient for someone who knows how much they can manage to pay monthly but do not know how much they are eligible to borrow. Input the preferred monthly payment, the number of months to repay the loan, interest rate and payment plan (weekly, fortnightly or monthly) then make the calculation. It will give you an estimated amount of credit you could afford to borrow.

How To Calculate Vehicle Loan Using Vehicle Loan Calculator:

  • Determine how much to borrow; negotiate the price of the car you intend to buy.

  • Visit at least three car dealers to ensure you get the best price for the vehicle you are buying.

  • Evaluate how much cash you have at hand to pay as down payment. Paying a down payment will reduce your loan significantly; hence decreasing your monthly payments.

  • After you establish these two steps, deduct the amount of down payment from the negotiated car cost. The difference will be the amount you need to borrow (principal amount).

  • Once you obtain the principal amount; open an online vehicle loan calculator to proceed with the calculations. Key in the principal amount, loan tenure (in months), and interest rate (quoted in the preapproval) then make the math. You will establish how much money in total you will pay at the end of the loan term, the total amount of money paid as interest at the end and how much you would be paying each month.

Some calculators offer amortization schedule which clearly shows you how the payment reduces until the term is over. Amortization schedule is a detailed illustration showing how payments are spread evenly over the loan term.
How is the vehicle loan calculated?

What Is Involved In The Calculation Of Vehicle Loans:

Co-sign Vehicle Loans

Calculation Of Vehicle Loans

Apart from the interest rates, there are fees that vehicle loans attract. The lender discloses these charges upon request for the loan.
Some of these charges include:

  • Taxes: tax is the amount of money charged by the government upon purchasing the vehicle. Add tax to your principal amount to determine the actual loan amount to be paid. The tax affects the loan amount but does not change the interest rate.

  • Dealer fees: also known as documentation fee. Is the amount of money dealers charge for the paperwork involved in loan preparation and filing.

  • Application fee: is a charge paid upon opening your vehicle loan. Also known as set-up fee.

  • Late fee: an amount of money charged on top of your monthly payments for failing to pay on time.

  • Monthly loan servicing fee: is a fee charged for the sake of managing the vehicle loan and keeping payment record.

These are just a few of the fees charged on loans. Make sure that your lender discloses all the fees charged on your vehicle loan. It is advisable to ask for clarifications on the charges you do not understand before signing the documents.

Vehicle loan Calculator

When using a vehicle loan calculator, it is important to specify whether you are estimating for new or used vehicle loans; as these have different rates.
This article is a guideline on how to calculate vehicle loan. It is important to note that vehicle loan providers in New Zealand have different terms and regulations. The vehicle loan calculator also does not give accurate figures as it does not factor in fee charges.