What Is a Loan Repayment Calculator?
A Loan Repayment Calculator is a digital tool designed to provide a clear picture of your loan repayment schedule. By inputting details such as loan amount, interest rate, and loan term, this calculator provides a breakdown of your monthly or yearly repayments.
How Does a Loan Repayment Calculator Work?
A Loan Repayment Calculator operates on the principles of amortisation, factoring in the loan amount, interest rate, and loan term to calculate the periodic repayments. It applies the interest rate to the outstanding loan balance to determine part of the repayment, with the remainder going towards paying down the principal.
Why Use a Loan Repayment Calculator?
The Loan Repayment Calculator provides a roadmap of your financial obligations throughout the loan term. It helps you understand how much you’ll be paying regularly, allowing for effective budgeting and financial planning. It’s like having a personal finance manager, guiding you through your repayment journey.