Monthly Payment: $216.29
You will need to pay $216.29 every month for 5 years to payoff the debt.
Loans can be customized accordingly based on individual borrowing preferences, but the number of available options can be overwhelming. Common deciding factors are the term and monthly payment amount.
Mortgages and auto loans tend to use the time limit approach to the repayment of loans. For mortgages in particular, choosing to have routine monthly payments between 30 years or 15 years or other length tends to be an important decision, because how long a debt lasts affects long term financial goals in other areas. The same can be said for purchasing cars when deciding between financing options that can possibly range from 12 months to 96 months, though the average is 65 months. Even though many car buyers will be tempted to take the longest option that results in the lowest monthly payment, the opposite of this, which is the shortest term, will result in the lowest total paid for the car (interest + principal) in the end. Car buyers should experiment with the variables to see which term is best accommodated by their budget and situation. For additional information, refer to the Mortgage Calculator or Auto Loan Calculator, which can provide more specific and detailed results.
Fixed Monthly Payment Amount
Use this tab if a known amount set aside each month is available for use as a loan payment. This value can be determined by figuring out how much disposable income a person has at the end of each month, after all other expenses have been accounted for. What's left over can be used to make monthly payments on a loan, taking into account other factors such as what the loan amount and interest rate will be. This method is often used to determine how best to repay debt on a credit card or other loans. For more information or to do calculations involving paying off a credit card, use the Credit Card Calculator. To calculate the most financially feasible way to pay off multiple credit cards, use the Credit Cards Payoff Calculator.
Variable vs. Fixed
Generally, there are two available loan options: variable (sometimes called adjustable or floating) or fixed. The majority of loans are fixed, whether in regards to the interest rate or routine payment. Loans in which these factors are fixed are conventionally amortized loans such as mortgages, auto loans, or student loans.
In variable rate loans, the rate may change based on indexes such as inflation or the central bank rate, which can alter the monthly payments. Revolving credit, as seen in credit cards, is not considered fixed because borrowers can make monthly payments that that can range anywhere from the minimum monthly payment due to the entire outstanding balance. The amount paid will affect next month's monthly payment, which will affect any following payments in turn. Credit card rates are generally fixed, but it is possible to request more favorable rates if the borrower shows excellent credit history.